I’m semiretired in my 30s and on the road to financial independence: Here is my best investing advice

"Compound interest is your best friend."

The wife and husband team behind the finance blog The Fire Couple.
Photo by Jesse Saler

One of the most empowering things I learned when I started my journey to financial independence in my 20s is that small savings can go a long way, especially when you're just starting out. I didn't really have a set goal when I started. All I knew is that my parents weren't always the best with their finances, and I wanted to make sure I didn't repeat the same mistakes that they made.

Today, I'm semiretired in my 30s and I write about my experience working toward financial independence and early retirement on my blog, The FIRE Couple

I never imagined that I would come as far as I have.

Experts recommend saving a minimum of 10% of your income. But if 10% is unrealistic, you can start out by saving even $10 a week. Thanks to the power of compounding, saving and investing as little as $10 every week can still add up to hundreds of thousands of dollars by the time you eventually retire.

I always loved saving. When I was a little girl, if we got birthday money from parents or relatives, I always spent a little and saved a little. Once I began my financial journey as an adult, I saved as much as I could afford, whether it was a few dollars a week or a few hundred dollars.

If I ever had any extra money, I would move it into my savings account. When it came to making purchases, I decided that I would only look at what was in my checking account and frame my budget around the money I had on hand there. I would only use my savings, which I placed in its own dedicated account, for true emergencies.

Today, I've come to realize that it wasn't the amount of money that I saved and invested, but rather, the act or habit of saving and investing that really made a difference. Here are some of the most important investing lessons that have helped me retire in my 30s. 

Compound interest is your best friend 

Compound interest means you earn a return not just on your money but also on the interest it has already accrued. When it comes to compounding, the most important asset you have is time. So, the earlier you start, the more time you have to compound your returns. 

For me, compounding has done wonders. Almost all of our savings aside from our short-term emergency fund (which covers six months of expenses) is invested in the stock market, assets like real estate, and cryptocurrency. So we receive rental income, interest, and dividends on all of our capital. This passive income has turned into thousands of extra dollars a year. 

Talk openly with your partner about money 

When my husband and I first started our financial journey together, it was not easy to talk about finances. The topic was very uncomfortable for both of us. He had student loan and credit card debts, and while I was debt-free, I was making less than $10,000 a year. I was living well below the national poverty line. 

We had to come up with a financial plan to tackle our financial problems. Rather than blaming each other for the financial mess we were in, we came up with a step-by-step solution to overcome our problems. The most important thing we decided to do was work as a team. 

We came up with a strict and detailed budget to solely live off of my husband's income, using any income I produced to pay off debts, save, and invest. This certainly wasn't an easy task in a city with a high cost of living, but we were able to accomplish our goals with discipline and practice over time.

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Making sure that your spouse or partner is on the same page as you is not only important for your finances, it also makes your relationship stronger. It can be easy to kick the can down the road when it comes to talking about finances, in an effort to keep the peace. But avoiding a discussion about money in order to avoid conflicts may only serve to increase financial problems you might have down the line. 

Talk about finances early and often. Coming up with a shared budget, investing game plan, and pooling resources to invest are great ways for a couple to grow not only their relationship, but also their wealth.

Find financial education resources that resonate 

What is opportunity cost? What does asset allocation mean? Do I need a financial advisor? Many people stop their financial journey before it starts because they are intimidated by financial language.

When I talk to people about finances, so many of them have internalized well-meaning but ineffective or incorrect money advice from family and friends. But it costs nothing to start to build up your confidence and knowledge about your money.

Personally, I'm a fan of Tom Corley's Rich Habits site for inspirational information about everyday people reaching extraordinary goals through their daily habits. Some of the classic books that really inspired me were T. Harv Eker's "Secrets of the Millionaire Mind" and Thomas J. Stanley's "The Millionaire Next Door."

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Don't let fear hold you back

When I was 23, I wanted to start investing, but I was too afraid to pull the trigger. I didn't know much about money, but I knew that I had heard that the wealthy have investments. An older friend told me, "Don't let fear hold you back. You will learn as you go." He was right. Once I started investing, it motivated me to become more knowledgeable and better educated about money. 

When it comes to compounding, the most important asset you have is time. So, the earlier you start, the more time you have to compound your returns. 

I had so many questions when I started. I heard terms that I didn't understand, like price-to-earnings ratio, alpha, and dollar cost averaging. It made my head spin. But reading more mentality-based investing books, like Robert Kiyosaki's "Rich Dad Poor Dad" helped me to clear the fog. Instead of focusing on technical jargon, I tried reading more psychological finance books, which for me, were more relatable and easier to understand. These types of books teach lessons about money using stories and simpler terms.

I believe the most important thing you can do is work to build your financial future. Just start with $10 a week as your initial goal. Once it becomes a habit, you will become motivated to find even more money to save and invest.  

In 10 years, with no large inheritance money or lottery winnings, The FIRE Couple have built a safe, multimillion-dollar, well-diversified portfolio of assets from scratch. Over the course of three years, they've grown a successful real estate investment business and became millionaires by the time they were 33. Today, Rosie and her husband have a combined income of over six figures, much of it coming from passive income.

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