This will be a time to remember. We just have to survive to tell the story.

I went from publishing my delayed post on March 8(talking about financial goals) to this current post in the middle of a full blown out pandemic a la 1918, when the Spanish flu shook up the structure of civilization and the human race.
Inevitably, our intertwined economies, amazing means of transportation and our human connection to family and friends in different parts of the world make us more vulnerable and maybe more profoundly affected by these kind of challenging events than we were 100 years ago. However, with all the medical and technological advances of our current world you would think that we would be able to dig ourselves out of this one and minimize the human cost.
We’ll see…In the meantime…

Is the FIRE movement dead?

Absolutely not. I think it is more alive than ever!!! As someone that jumped on the bandwagon of financial independence two years ago I can tell you that thanks to looking into my finances I can still go to bed and have a great sleep in the middle of this global disaster.
If the Corona virus would have hit two years ago I would have had only $400-600 in the bank, 6-8K of credit card debt and the pending burden of non-discretionary bills, such as my mortgage, utilities and food.
Today, in the middle of this pandemic chaos I am in the best position I can possibly imagine. No debt, living in a great area with nice trails, a decent amount of cash stashed away, and with our mortgage as my only liability.
I am far away from retirement. Maybe 9 years, according to that awesome countdown timer on my splash page.
I’m not even financially independent, but my situation illustrates perfectly why the FIRE movement isn’t dead, but more alive than ever. I depend on my salary heavily, but being part of the FIRE wannabes has given me the capability to endure this unprecedented time.
The desire for FIRE has secured a solid financial foundation to weather this financial storm with my family.

My Biggest Financial Concerns During this Pandemic

I was sent home on March 13, 2020. Not much later than that, I received an email from my school district confirming that we would continue getting paid while being home. At first, those days were supposed to be accounted as snow days, God events, but later we moved into the idea of E-learning.
Luckily, we were guaranteed our regular payment as we continue working from home. Of course, if everything extends further than expected, and people start losing their homes, not paying taxes, etc., that would eventually impact my school district as well and trickle down to me. Hopefully we don’t get there.
My biggest concern, besides continuing getting paid my regular income, was to secure my rental income. That would have put a big dent in my pocket if I had to absorb an extra mortgage. Luckily, what once was an iffy decision due to all the horror stories around affordable housing and the Section 8 program, I can tell you that today I feel like the luckiest man on Earth for having a Section 8 tenant. My current tenant is responsible for about 2% of the total rent amount and the government pays the rest. The tenant not only keeps the property in superb condition but also pays electronically right on time; sometimes even earlier.
Again, you would think that in these difficult times money should be the least of our concerns, but it’s not. It’s the main concern besides avoiding getting sick with that Covid-19 crap! Money and money related stresses are going to devastate a lot of families and individuals. I am confident that we will see the financial repercussions of this pandemic for several years to come.
Now, thanks to my FIRE goals, all I have to worry about is staying healthy and keeping my family entertained in the comfort of our home.

The Emperor Has no Clothes

Analyzing this pandemic with a critical perspective, you just can’t deny that besides being an unprecedented event, it’s exposing what we knew all along, but we refused to see.

We live a in a world full of inequalities and abuses that will be now accentuated by this pandemic, bringing dramatic consequences to countries where medical care is available to only those with economic power within that particular social group. While the pandemic keeps unfolding in less fortunate countries, not only will medical attention be limited , but also food, water, electricity and transportation. Besides, of course, information! **India less than 500 deaths with a population of of 1.3 billion people, really?**

So, if you are in a developed country, I hope you realize how privileged you are. Getting your groceries delivered to your door, having a guaranteed network of food distribution and Amazon providing you with any crave you may have to satisfy your hobbies and intellectual needs is as privileged as privileged gets. That is not the normal for most of the world.

This is not to say that in developed countries there are not less fortunate folks being ravaged by the consequences of this pandemic, but never at the levels of countries like Venezuela where poverty is rampant.

Can we really overcome this chaos if we continue overlooking the fact that we don’t give an absolute shit to what is happening in other countries as long as we can continue getting cheap labor and products? Or do we call this pandemic an “externality” of our privileged lives and move on as we watch the John Hopkins Corona Virus Map gain another death?
It is hard for me to imagine a pandemic free world and coming out of this one triumphantly without focusing on some of these challenging issues pertaining social justice domestically as well as internationally.
I am left wondering if this pandemic will trigger the necessary changes for some less fortunate countries. Likewise, I hope this chaos settles for once and for all that health care should not be just a money making enterprise or privilege for a few people, but a right that helps us all.

Corona virus map by John Hopkins Hospital showing the current state of contagion and death in the world.

Lessons Learned from an Unprecedented Event

First of all, I would not recommend anybody to make any drastic changes during this time. This is not the time to take chances using your emergency fund to invest it on a winning stock, with hopes that the market will rebound after stocks have dropped more than 20% of their value.
If you already have money in your 403B/401K , IRA, Roth or any other account, likewise, this is not the time to be moving things around if you are a conservative investor like me. Not worth it! To me, my sanity and tranquility is worth more than a few thousand dollars.
Now, if your expenses are covered and you have extra cash to play the game of buying the dip without jeopardizing your current situation, that’s a different story. Increasing your current contribution to your tax deferred accounts can certainly bring some reward once we are out of the woods with this pandemic. In my case, that is not part of my game right now. Besides, I recently increase my 403B contribution right before the pandemic dilemma started. Hence, I feel like I already put a check mark on that one.

My second lesson learned from all this, and please, imagine myself kissing the ground thanking the universe for this one, is start your FIRE journey as soon as you can, which is right now. Remember, any drastic changes aren’t worth it at the moment, but start thinking about it! What is your number? What is your blueprint to become financially independent? Once you start that journey it doesn’t matter how fast you walk it, you will always be in the best position you can possibly be financially.

My other lesson learned from this pandemic debacle is DIVERSIFY!!!
It doesn’t matter what you do, diversify!!!
In my case, what once was an uncertain path of doubts holding me back from renting to Section 8 tenants, it has become a life saver. Thanks to the fact that my rent is back by the government I have no worry about getting paid or not. In my mind, Section 8 will always be part of my rental portfolio as I continue acquiring properties.
I am planning on getting one or two more rentals in the future and I think that government backed tenants are a great mix in a landlord’s portfolio as long as you do your diligent work of screening your tenant properly; just like you would do with any tenant.
Another nugget of wisdom that I will continue to treasure is to avoid high leveraged deals. All those folks out there preaching OPM(Other people’s money) strategies sound very smart when the wind is blowing in their favor, but if by any chance you get stuck in the doldrums of a financial havoc, things can get ugly pretty quick. Especially if a 2008 Tsunami all of the sudden comes your way it’s unlikely you’ll survive. That leverage can work both ways!
We don’t know exactly how the housing and rental market are going to react to the Covid-19 scar, but undoubtedly we are already seeing some consequences and it will definitely have some profound effects as we see record high unemployment applications; even if a Covid-19 vaccine was found tomorrow it will take some time for the economy to recover, including the time to convince the antivaxxers to get the shot.

Don’t be ashamed for sitting on a nice cushion of property equity. Buying and holding a rental until you pay off your mortgage before you move on to buy another property is perfectly fine and quite risky as it is. There is no reason for gambling.
Call me lame, but that’s what I am doing, and life is great!

2020 Goals Modifications

After getting out of debt this year 2020, we set up a new target: Paying our rental’s mortgage off.
Right away, after paying our student loan we received our 2019 tax return and stashed it away. Using the snowball debt paying strategy we started detouring the former student loan payment towards the new debt target.

However, I didn’t want to wipe out the account right away and just dump it on the mortgage; not quite then. And thank God I didn’t! Not much later, after we pooled all the money together and we were going to make a move, Covid-19 started creeping in. By March 13th I was sent home as the Coronavirus had made its way to the Chicago area.
Now, a month later, I still haven’t moved any money and it is just accumulating in the bank as a safety net. I am still getting my regular income and actually we are saving quite a bit of money by staying home. I am still hesitant to make a big move and nearly zeroed my account by dumping money on a mortgage. We will wait.
I have also been tempted to buy the dip and sink the money in the stock market, but sincerely a 20-30% gain doesn’t justify the peace of mind I have right now, knowing that I can cover all my expenses if necessary using that money stash.
Call me risk averse, but I prefer having a nice sleep at night. I have a wonderful life and I can provide for my family quite comfortably. That’s what matters to me. Why push it?
My biggest financial move during this pandemic, which I also accredited to my pursuit of FIRE, is having just scored a nice refinancing opportunity through a local credit union. We had a 4.75% 30 year fixed mortgage. Now, we will have a 3.3% rate which will bring about $140 in savings monthly. It doesn’t sound like much, but yearly it will save us $1,680. At the end of 30 years we would be saving $50,400! That’s quite a bit of money. And I prefer it in my bank account rather than the bank’s!
To conclude, my 2020 goals are keeping the course with a few changes. Financially I feel that we are secured. Now, we just need to make sure the whole family makes it through through these troubled waters. If so, I think we will come out in an even better situation we had anticipated for 2020 due to our mortgage savings, going nowhere and so far one stimulus check that just came in.

I would love to hear how is this pandemic affecting your financial goals and what changes you have had to make.