In this episode, Emily interviews Dr. Gov Worker, which is the moniker used by a PhD scientist and FIRE blogger. FIRE stands for Financial Independence and Early Retirement. As a PhD, Gov Worker’s motivation for and path to FIRE are different than most and specific to his high degree of training, and he thinks other PhDs should consider FIRE as well. In this second half of the conversation, Gov Worker shares what his family is doing to achieve FIRE, how being a PhD has affected his FIRE journey, and his financial advice for early-career PhDs.

Further Listening: This PhD Government Scientist Is Pursuing Financial Independence: Part 1

Links mentioned in episode

• Financially Navigating Your Upcoming PhD Career Transition
• Personal Finance for PhDs Podcast Hub
• Volunteer as a Guest for the Podcast 
• Government Workers Pursuing FI (Financial Independence)

Teaser

Dr. Gov Worker (00:00): When you do save any, any dollar you save, like buys you a little bit of freedom or a little bit of flexibility or some options. And that’s why I think that’s why I’m just such a big believer in the whole movement. Um, if it’s getting more people to think about and save some money that then they can use to like free themselves up to what they really wanna do.

Introduction

Emily (00:27): Welcome to the Personal Finance for PhDs podcast, a Higher Education in Personal Finance. I’m your host, Emily Roberts. This is season three, episode nine, and today my guest is Dr. Gov Worker, which is the moniker used by a PhD scientist and FIRE blogger. FIRE stands for Financial Independence and Early Retirement. Gov Worker and I had such an engaging and in-depth conversation that I’ve split it into two episodes last week’s and this one. In this episode, we discuss what his family does to pursue FIRE, how being a PhD has affected his journey, why other PhDs should consider pursuing FIRE and his financial advice for early career PhDs. Without further ado, here’s the second part of my interview with Dr. Gov Worker.

Did you make any changes to your lifestyle and spending when you decided to pursue financial independence?

Emily (01:18): Let’s go back to this question of, of how are you pursuing FIRE? You’re natural savers. You’ve been living within beneath your means for quite a long time. Did you make any changes, uh, when you decided that you were going to pursue FI?

Dr. Gov Worker (01:32): Yeah, and I think it’s been continual changes for the past nine months because I’ve been reading a lot. I’ve been learning a, a bunch and trying to been optimizing. So I think we’ve tried to switch more towards contributing or saving in, uh, tax favored accounts like your 401k or even your health savings account. You can save money there, shelter it from taxes, and then if you don’t need it for, well, there’s a whole whole bunch of things you can do with a health savings account. So we’re saving quite a bit of money in after tax accounts. And even prepaying our mortgage is like an after tax savings. Um, so we’ve switched a lot of our savings around, so we’re saving that in tax, tax deferred accounts, um, like 401Ks. And, um, we went through our expenses. I think one of our, the, like, the best thing you can do if you wanna get started is just tracking, um, every, every purchase you make. Um, so we do that in an Excel spreadsheet and I think there’s a lot of services where you can like track your finances, but for me, knowing that I’m gonna have to type something in a spreadsheet really makes me think about the purchase. So there’s something, there’s like, you know, if it just showed up on a computer screen, um, on like Mint or Personal Capital, that whatever, it just kind of goes through my head, but like having to write it down is powerful. And so we, with like tracking expenses and other stuff, we, we were able to cut quite a bit of money that we were spending kind of unconsciously or subconsciously or not getting, and, and our lives has, our lives haven’t gotten worse. We don’t feel deprived. We still spend a lot of money on things we really care about. Like I take piano lessons, my daughter takes piano lessons, my daughters take piano lessons. Like we really enjoy doing that, so we spend money on it. And yeah, we could reach financial independence, you know, maybe a few months earlier if we didn’t take piano lessons or something. But that’s not, that’s not what it’s about for me. It’s about, hey, we’re spending a whole bunch of money on like childcare from like three to 4:00 PM if, whereas if we switched our schedules, we could not have to pay for childcare for that thing and spend more time with our kids. Well that, that’s kinda like a win win-win. I mean, okay, it’s like tough if you both have meetings then and there’s headaches, there’s trade offs, but I think a lot of times we’re told like, Hey, you deserve it. Just do something easy. Like yeah, have somebody help clean your house or have somebody come watch the kids or you work really hard, it’s worth it to pay somebody like a few bucks an hour to do this for you. And sometimes that’s true and sometimes it’s not true. So I, I just really want people, if they’re interested in this, to like look at what they’re spending and then think about how much joy they get from that and try living without something. And if it, if you feel deprived, then like add it back in. But at least you know what it feels like to not have that.

Can you comment about high savings rates in the FIRE community?

Emily (04:51): I think we’re gonna go into this a little bit more, um, in a moment about maybe looking at your lifestyle as a grad student and then your lifestyle, maybe post-graduate school and thinking, can I still live the way that I did as a graduate student? Um, a little bit longer. But before we get there, um, I wanted to to ask you about savings rates because one of the things that’s really, um, notable and also intimidating about the fire movement is that people post these incredible savings rates. I save 50% of my income, I save 75% of my income, I save 85% of my income. Um, those things can also seem like fairly unattainable, but this isn’t a very important part of pursuing fi, which is to have, you know, a lot, a lot of money going into savings investments, um, and also dramatically lowering your living expenses. So you create this big, big gap between your income and your living expenses. So you can have that high savings rate. And also so that your ongoing living expenses, let’s say once you reach financial, financial independence, um, your living expenses being lower means your nest egg has to be a little bit smaller. Right? Did I get that right? And, uh, can you, can you comment a little bit about these savings rates?

Dr. Gov Worker (06:04): I would just like to say that if you see a savings rate, unless they explicitly say how they calculate it, it’s really hard to know how much they’re actually saving because some people include the amount of mortgage principle they’re paying each month as in part of their savings rate. Some people, I mean there’s the numerator and the denominator, right? So are you normalizing to like your gross income? Are you normalizing to your post-tax income? Some of the savings, your savings are pre-tax, some are post-tax and if your, you know, employer gives you a like 401k match, is that money you saved or is that just money that appears? So these numbers that people publish, there’s a wide range of what it actually is. So don’t, don’t get intimidated by those numbers because they could inflate ’em or I mean, not inflate ’em, but it could be misleading. So yeah, you got, you’ve gotta try to save as much money as you can and, and live on as little money as you can and still be happy with your life. And that ultimately determines how fast you will achieve this financial independence. Um, so for us, our savings rate isn’t like 90% or any of these impressive numbers, but daycare is a huge, huge chunk of our income. Our mortgage is another huge chunk ’cause it is a 10 year, uh, mortgage. So I haven’t really calculated a timeline to financial independence or anything like that. That’s not super important for me. ’cause I know in five years my youngest one will be in school and we’ll have the house paid off and our expenses will drop. I mean, those things consume like, I don’t know, 60 to 75% of our budget is just daycare and housing and there’s nothing we can do about that. Um, that’s just the stage of the life we’re in. Um, and so if I like compare myself to like a double income, no kid family, um, that’s putting away 90% of their income, that that doesn’t really help me think about my path to financial independence. So I, I mean, I know savings rate’s a key thing on how fast you achieve fi and if you start, if you start down this path, you can choose your own method of calculation and come to your own consensus about it. But it’s not, it’s comparing or seeing those numbers isn’t, isn’t really super duper helpful, at least to me.

Emily (08:37): Yeah. Thank you for pointing that out because, so I, maybe this is a misconception that I have, but I see that, um, okay, my savings rate is X and my time to fi is, is Y, um, as kind of core integral to the way people talk about this sort thing online. Not that necessarily everyone has to do it, but it’s a very popular thing to do. Um, and I really couldn’t relate to that because the listeners probably know, like I rent, I live in a city that I’m not interested in living in long term. So it’s really hard for me to see beyond, well, at some point I need to purchase a house and then maybe I can think about, you know, what this FI thing is. Um, so it’s hard for me to see beyond that. So similarly to you, I think that I have this, you know, transition point for you, it’s, you know, my children out of daycare and the house is paid off, then we’ll see, you know, what the calculations are. Until then, let’s just work, do good things and not worry too much about the savings rates. I think I’m in a similar spot to that. Just, you know, work on being solid financially, uh, for the time being until we get past this unknown point and then, uh, then we’ll see if we can do those calculations.

How does being a PhD affect how you think about financial independence?

Emily (09:44): So I’d like for you to speak, um, a little bit more specifically as to how being a PhD has affected, uh, your journey to FI or the way you think about FI or the journey there too.

Dr. Gov Worker (09:57): Yeah, I mean, I think on a super simple level, like I didn’t get my PhD until I was 27. Um, and there are people that I know in the fire community, they’re like retiring at age 30 or younger, right? So if you, if you’re getting a PhD, you’re not gonna be one of these early fire people because

Emily (10:17): By the way, getting a PhD at 27 early side, very,

Dr. Gov Worker (10:21): Yeah, Right. I I should have clarified that. So I, I guess speaking for myself and I, I do know that was on the early side, but so say at the earliest you’ll be 26 or 27 with your PhD, it’s unlikely that you’ll be able to retire at 30, um, because Right, you don’t have that many years to work, so you don’t,

Emily (10:43): Unless you are Jacob Lund Fisker from Early Retirement Extreme. Just wanna throw that in there. Go ahead.

Dr. Gov Worker (10:49): Okay. Yes. Okay.

Emily (10:51): I do not recommend following his route, but if you’re interested, Dr. Jacob Lund Fisker early retirement Extreme, another father of this movement.

Dr. Gov Worker (10:58): Yes, exactly. Um, so now that we’ve got that out of the way, um, I think, so I had a later start entry date into the workforce that’s common with PhDs. Um, I think getting a PhD was helpful in pursuing fire in that as a graduate student, I had to learn how to live really lean. And so I was comfortable with, um, not inflating my lifestyle as much as other people that I got my undergraduate degree with, um, and then saw what they were doing. Um, and then once I did graduate, my salary is much higher than the median salary. So I think those are things that help, um, what’s kind of more difficult as you interate, but I think those are just like the nuts and bolts. I think a lot of it more has to do with this identity factor because unlike someone that just gets an undergraduate degree, um, and a and has some broad knowledge in a general field, getting a PhD or, or getting an md I know that, uh, there’s several medical doctors who, who are in the fire community and have written really great stuff about this too, is that you, you, you’re really invested in your field because you, you spent so long obtaining this knowledge. And, and so when I think about, I definitely want to achieve financial independence because there’s some parts of my job that are really stressful and especially travel with, uh, having a young family and now having to, the higher you rise in science, the more you have to travel <laugh>. Um, and I think nobody ever talks about that, but, um, you know, early retirement is gonna be different for someone with a PhD because they have invested this years of knowledge and even if they really hate their job, like there, there was some spark that led them to pursue a PhD at some point and to obtain this field of knowledge. And so letting go of that is gonna be a different emotional process for someone that just, um, enters a field to just earn as much money as possible and as little time as possible and then leave. Yeah, so there’s an emotional aspect, uh, as well.

Commercial

Emily (13:24): This summer I’m putting forth extra support for PhDs undergoing career transitions into grad school, a postdoc or a real job. If you’re moving on to the next stage in your career or thinking about it, please visit pfforphds.com/next to check out my articles, webinars, and coaching program. Allow me to come alongside you during this transition to ensure that you set yourself up for financial success.

Once you have financial independence, do you think you’ll still use your PhD knowledge?

Emily (13:54): When I think about, um, academia like Ivory Tower academia, you know, there’s this stereotype that academics shouldn’t care about money. They shouldn’t money grub, they shouldn’t be concerned about their salaries or benefits, whatever. They should live the life of the mind and, and that’s it. Um, but I, but the best way to not care about money is to have enough money that you don’t need to be concerned about it. Um, so I actually really think that becoming financial independent is very, um, compatible with someone who wants to, you know, pursue scholarly work, for example, and not be, um, I don’t know, not be tied to like obtaining grants or, you know, whatever the normal stuff that comes with like a job once you reach fi if you decide to retire early, like, do you think you might still do anything with, um, you know, this knowledge you’ve, you’ve taught, fought hard for over time, or do you think you’re gonna be leaving that behind?

Dr. Gov Worker (14:48): No, I mean, when I think about my happiest times in the past 10 years since getting my PhD, there’ve been times when I’ve been on like a sabbatical. So I’ve been in a new environment, I’ve been working with people I know in the field professionally, but not close because we didn’t work together ’cause of distance. And so there was like this aspect of travel, there was this aspect of collaborating with new people and there was this applying my knowledge to like projects I cared about without having these administrative duties, which consume a lot of my time and are where most of my job dissatisfaction is. So I haven’t allowed myself to think too, too much about early retirement, but I could easily see, and if you don’t have to worry about money, then you can like, you know, travel to work with that colleague for six months or a year and not have to worry about having your salary covered. Um, and so, I mean, I could see easily and really enjoying doing like a series of like little sabbaticals with people, um, that I like working with. And I’ve like, uh, worked with on sabbatical before, um, I could see working as a consultant in my field. I mean, there’s a lot of things that I think I would like to do if I, if I do achieve early retirement that involve this part of me that spent all this time to gain this knowledge, um, that aren’t this traditional like ivory tower or, you know, achieving academic success or, you know, publishing papers in the, the highest tier journals or, you know, winning the most prestigious grants. You know, I just feel like, yeah, yeah, you could do that, but that doesn’t gimme as much satisfaction as, you know, really working on a really cool paper with somebody. Um, and it would be great to be financially in a point where I could work with people, um, but not have it be tied to these heavy things. But that being said, there’s a lot of other things I’d love to do. Like I love playing piano, I love doing all these other things. And so I had a chance to experience this. There was the government shutdown, um, earlier this year, so I had like more than a month of time off. And I think pursuing FIRE was really great because the first day of the shutdown I looked at, um, my accounts and I realized, well, okay, well if we don’t change anything, I’m good for several years without bringing in income, I don’t need to worry about buying groceries or anything. So I think that’s a really great reason to pursue FI because um, it gives you this peace of mind if something does come up I have this month to experience what I would do if I didn’t have, um, paid job because when the government shuts down, you have to hand in your laptop, cell phone, everything gets like locked up and you’re forbidden from interacting with work at all. And it was so magical to just have the time to focus on my passions and my family and like be right there and the kids came home from school and have like meaningful conversations and pursue leisure activities, which I think is really important. And our society minimizes the value of leisure. Um, and so I think I could easily achieve financial independence and also leave this all behind and really just focus on, uh, what, you know, being more intentional, living more in the moment and really enjoying the whole of myself, if that makes sense. Yeah. Sorry for the really long answer.

Emily (18:37): No, that was, that was really lovely actually because I found a lot in there that I can identify with. Um, and maybe the listeners have as well, like, especially about when I was in grad school and actually before I even started grad school and I was looking at the structure of academia and thinking to myself like, I love being at the bench. I love doing the work. I am not interested in having the job that my advisor has. You know, like, how do you stay in science and stay doing the work? Like at that, at the time, uh, I did a year at the NIH as a postbac and I was looking at the postdocs, and this is a bit naive I realize now, but I was looking at the postdocs and thinking, that seems like the best job. Like, I wanna be a postdoc, you know, you know, forever doc, right? I mean, no one actually wants that, but I really liked the idea of, um, staying doing the work and not having to do all these things that come with career advancement, which as you said, you’re kind of, you almost need to take, um, to stay in the field. But I just really love the idea of you, um, maybe finding a way to have all of this balance that you want in your life between your, the personal stuff you want to spend time on and also working when and how you want to, uh, when it, when it tickles your fancy. Right. Um, so I don’t know, maybe there are other people out there who can identify with, with something in there.

Do you think other PhDs should be thinking about FIRE?

Emily (19:57): Um, do you think that other PhDs should be thinking about FI, thinking about fire or pursuing it?

Dr. Gov Worker (20:04): Yeah, I think everybody should think about FI. Um, because even if you don’t achieve full financial independence, there’s so many benefits that come just from having a year’s worth of expenses saved up and know that they’re accessible. Um, I’ve seen not, not PhDs, but people I know socially that are in really toxic jobs but can’t afford to quit because they’re, you know, essentially living paycheck to paycheck. And that I think is, is really sad. Um, so I think FI or at least trying to get in better financial shape is for everyone. If you want to, if you want to try to achieve this early retirement and save, you know, 75% of your income plus or minus, you know, 25% or something, um, you should definitely do that. And I think there’s gonna be a lot of benefits that come along the way. And for me, even once I started pursuing FI, mentally, I was so much happier in my job because I knew that it didn’t have to be permanent and I wasn’t locked into my job. So I think mentally even just committing to this idea has benefits. Uh, saving, saving money and creating financial space has so many benefits, like mental benefits, like, you know, spiritual benefits. I think it’s just, it’s just so important to, to try and start down this path and that not everybody needs to achieve early retirement. Not everybody needs to retire by 30. There’s a lot of great voices in this kind of community. And so when I think about, when I think about fire, it’s more of an alternative path to pursuing happiness rather than this, you know, really hardcore eating rotten bananas ’cause they’re cheaper, you know, struggle to, you know, quit early, if that makes sense.

Emily (22:08): Yeah. And I think, um, I mean, looking at the fire movement as it exists online, at least that I’ve seen, um, very extreme stories get a lot of attention. Um, and maybe the ones that are more like yours, which is like, okay, I’m, I’m a family man living in the Midwest and I’ve got three kids and, and this kind of thing. Um, they don’t necessarily look as flashy, but there can be still so much personal satisfaction that’s found in, you know, living the way you want to and having freedom and having options along the path to fi and after you achieve fi.

What are the next steps for someone who wants to start on FIRE?

Emily (22:45): Um, so let’s say that, you know, there’s someone listening, um, a grad student, a postdoc, another PhD who has a real job, um, and they’re like, Hey, I want some of the things that you talked about during this episode. I wanna have these, these feelings and this, this freedom. Um, how should that person get started? What next steps should that person take?

Dr. Gov Worker (23:05): Yeah, I would say, um, the first thing to do would be, um, to get familiar with the fire movement, um, online. Like I said, there’s a lot of great bloggers, there’s a lot of great books that are being published, um, recently, um, on this topic. And I think to just try and continue living your graduate student lifestyle in your first job and saving as much of that as possible. Um, and if you’re listening to this and you’re like, oh, I don’t wanna pursue fire, that’s never gonna be me. Like, I just wanna make sure that like, no matter what you do, like, like absolutely a hundred percent, um, before your first paycheck comes, set up your 401k contribution to get the most of your employer max. Like, ’cause that, that is just so important. And, and as your salary grows with time, that will scale. And, and so like even if the rest of this podcast doesn’t apply to you, please just set up your 401k to get the maximum of your employer match. ’cause that’s free money. And if you want to pursue fire, then like, yeah, put as much of it in there as you can continue to have roommates if you had roommates in graduate school and are used to that and think you could do that for longer. Um, and just not, yeah, I think not try to buy into what your peers are spending their money on, because unless it makes you happy, there’s, there’s no reason to to spend money on it.

Emily (24:34): Yeah. This is the, this is the keeping up with the Joneses thing, right? Oh, well I am 30 years old, I’m 35 years old. That means that I should be using my money in this way. That means I should have this kind of car and this kind of house. Um, and that’s all fine if you can afford it and if you’ve, if that’s something that you really want, but don’t go down that path just because you see other people doing it, right. Um, really just find what’s going to give you the most, um, satisfaction in your life and probably options and freedom are going to give you life satisfaction. So like you said, you know, make it automatic, like contribute to your employer’s, uh, retirement plan and so you never even see that money. Like that’s an excellent first step. I totally agree. Anything else you wanna add on that?

Dr. Gov Worker (25:20): Um, no, I just, I just really think that, I really liked how you put it. Um, when you save money, you’re really buying yourself options or flexibility that you might want later on. And when I think about my life now, um, and my job, I just, I wish I had more time and money money’s not, not that important. And actually career success isn’t that important, but when you’re in graduate school, it’s like a pressure cooker that you need to like apply for these, you need to be fully devoted to your field. And people question that all the time in academia and, and I just, you know, it’s kind of a shame that you spend all this time in this like high intensity environment and realize, whoa, really if I could have anything in this world, I, I wish I had more time to spend, uh, with people I love or doing things I love or these other things that aren’t necessarily my job. And so when you do save any, any dollar you save, like buys you a little bit of freedom or a little bit of flexibility or some options. And that’s why I think that’s why I’m just such a big believer in the whole movement. Um, if it’s getting more people to think about and save some money that then they can use to like free themselves up to what they really wanna do.

Where can people find you online?

Emily (26:43): I think we need to end it right there. That was wonderful. Thank you so much for, for joining me today, Gov Worker, where can people find you online?

Dr. Gov Worker (26:50): I’d love to interact with any listeners who are interested in learning more about the fire movement. The best way to do that would be to check out my blog, uh, which is at, uh, governmentworkerfi.com. I’m also quite active on Twitter, so you can tweet at me as well. Um, my Twitter handle is @govworkerfi.

Emily (27:09): Yeah, that would be amazing. So hopefully at least a few people will find their way over to you and hopefully we’ve sparked some interest in this movement. Um, thanks again for joining me.

Dr. Gov Worker (27:17): Yeah, thank you Emily.

Conclusion

Emily (27:19): Listeners, I’m so glad you joined us for today’s episode, pfforphds.com/podcast is the hub for the Personal Finance for PhDs podcast. There you can find links to all the episode show notes, a form to volunteer to be interviewed, a survey, and a way to join the mailing list. I’d love for you to check it out and get more involved. See you in the next episode. The music is Stages of Awakening by Poddington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing and show notes creation by Jewel Lipps.