In 2009, Sam Dogen founded Financial Samurai, one of the top independently owned personal finance sites today with over 1 million organic visitors a month. Here is Sam telling his own story.
Hello everyone! It’s nice to have you here. I thought I’d share some background of who I am, what makes me tick, and various thoughts on financial independence.
In 2009, I helped kickstart the modern-day FIRE movement and it has grown to be a worldwide phenomenon!
Financial Samurai Upbringing
I grew up in the Philippines, Zambia, Japan, Taiwan, and Malaysia for 13 years before coming to the United States for high school and college. My parents were in the U.S. Foreign Service and were stationed all around the world when I was growing up.
Due to my upbringing, I caught the travel bug early and it has never left. I’ve visited over 60 countries as of 2023. But I slowed down after having my boy in 2017 and my girl in 2019. Kids don’t remember much of anything before three years old. Therefore, we plan to wait until both kids are over five before traveling again.
I’m very pro public school because I went to a public high school and The College of William & Mary, a public university. Most people probably shouldn’t spend a fortune on private school because everything can be learned for free nowadays. However, if you make more than 7X the annual tuition per child, affording private school is doable.
One of my goals after college was to work overseas in Asia. I came close when my dad’s friend offered me a job to work at his eyeglass parts factory in Shenzhen, China in 1999. But I passed because I got a job at Goldman Sachs, an investment bank in NYC in their International Equities department. At the time, less than 5% of people who applied got in.
It was an opportunity I could not pass down because such a firm did not recruit at a public university like mine. It just goes to show that you never know what might happen if you get on a bus at 6am on a Saturday to go to a career fair. Getting a good job right after college felt like I had won the lottery.
Taking A Risk By Changing My Life
During the middle of the financial crisis in 2009, I began Financial Samurai to help make sense of the financial crisis. I had been working in finance for 10 years and thought I had been doing all the right things with my money – saving 50%+, diversifying into real estate, maxing out my 401(k), etc. Yet, I still lost about 35% of my net worth within a matter of six months. It was a humbling experience.
On the bright side, the financial crisis made me realize that I no longer wanted to work in the financial services industry. After 13 years, I lost the hunger to make lots of money and climb the corporate ladder. Instead, the downturn focused my attention on something I really enjoyed doing: writing and connecting with others online.
I found myself addicted to Financial Samurai before work, during my lunch break, and after work. Therefore, in the Fall of 2011, I came up with the idea of negotiating a severance to be free from work for good. I was sitting in a bar in Santorini, Greece overlooking a massive crater on a warm sunny day.
Never Quit, Get Laid Off Instead
The severance was an integral part of my early retirement plans because without it, I would have continued working until 40, my original early retirement target.
The severance allowed me to keep 100% of my deferred cash and stock compensation that paid out over three years, and 100% of a six figure investment that paid out over seven years. Further, I got a nice lump sum severance check as well.
In essence, the severance accelerated my early retirement by six years, so I figured why the heck not! If I failed at early retirement, I could also go back to work.
If you plan to retire early, never quit, get laid off instead. There is no downside to trying to walk away with a healthy financial runway.
Since leaving work behind in 2012, I’ve done some part-time consulting for several fintech companies in the SF Bay Area, traveled to 20 new countries with my wife, won a couple high school tennis conference championships as a coach, and most importantly, had a son in 2017 and a daughter in 2019!
I love being a full-time parent now. The first five years of their life before they go to kindergarten is the most important time for development. My hope is that I can bond with them when they are young so they will bond with me when they are older.
Sam Dogen, Bestselling Author
After two years of writing and editing, in 2022, I published an instant Wall Street Journal bestseller called, Buy This, Not That: How To Spend Your Way To Wealth And Freedom. I synthesized 27+-years of finance experience to help readers build more wealth and make more optimal decisions.
Education is the key to freedom. I highly recommend you pick up a copy at Amazon or wherever you like to buy books. If you read BTNT, you will gain more financial knowledge and become a better decision-maker than 99% of the population.
General Lifehacks I Follow
I’m a counter cyclical type of guy. For example, instead of playing tennis at 5pm or later, whenever everybody tries to play, I play between 11am – 3pm when the club is empty. Instead of getting stuck in rush hour traffic at 8am, I used to get in at 6am and leave by 4pm.
Going to lunch at 12noon is the worst!
When it comes to writing, instead of cooing about how the Roth IRA is the best retirement vehicle ever, I wrote a critical piece on why the Roth IRA is bad for many people. Instead of writing about how my life is so hunky dory in early retirement, I like writing about the negatives of early retirement nobody likes talking about.
I find that if I go the other way, I tend to have more time and success. Going the other way also helps me think about critical issues that I wouldn’t have thought of before.
Of course, I’m sometimes wrong about my views as well. This is why I welcome all types of perspectives on Financial Samurai. The last thing I want to do is go through life with many blindspots. Living in an echo chamber restricts growth.
The Three Things I’m Most Proud Of
I’m most proud of my wife for carrying and delivering our two children. We tried for several years to no avail. But she got through it and succeeded in delivering the best thing that has every happened to us.
I’m proud of my children for learning and figuring things out on their own. As a new parent, it pains me to seem him sad and frustrated. All I want to do is help him with everything. I’ve learned not to rush over, but to let him struggle. When he figures things out, his face lights up and so does my heart.
Finally, I’m proud of keeping my promise in 2009 of writing three articles a week on Financial Samurai for 13+ straight years. There were so many times when I was dead tired from work or exhausted from being a stay at home dad, but I forged on through.
If you want to create something good, I firmly believe you need the grit to stay consistent. If you never quit, it’s very hard to fail!
My Relationship With Money
I grew up in a very frugal household where my dad admonished me for ordering anything other than water with a slice of lemon. He also drove a paint-less, 14-year-old 1976 Datsun when I was in middle school, which embarrassed the heck out of me. But my parent’s frugality laid the foundation for my frugality once I started making my own money.
One of my most important mantras early on was: If the amount of money I saved each month didn’t hurt, I wasn’t saving enough. Here’s a post on how much you should save by age if you want to achieve financial independence.
Despite getting a job in finance, I lived in a studio with a friend for two years. Despite being able to “afford” a fancier car once I got a raise and a promotion out to San Francisco in 2001, I took public transportation and got a six-year old Honda Civic instead.
Up until about 2018, I had frugality disease. I had an extremely difficult time living it up before then. For the first three years after early retirement in 2012, I wanted to be very cautious about how I spent my money just in case I made a mistake.
Then in 2015, my wife negotiated a severance as well. That made me cautious about spending too much for the next several years. Then our son was born in 2017, which added more expenses.
Have Children And The Money Will Come
But starting in 2018, I realized we’d be financially OK, partially because we ran a detailed budget and reached our goal of achieving ~$200,000 a year in passive retirement income.
We had a large enough buffer where we could easily spend $1,000 – $2,000/month more, so we did on food, babysitting, housecleaning. Basically all the things that would make life easier for stay at home parents.
More than 10 years after early retirement, I’m finally getting comfortable with trying to spend all our income we make each month. We have yet to succeed, but we’re trying!
Having children has motivated me to continue growing our wealth. I hope to one day teach them about personal finance and online entrepreneurship.
The Sacrifice Is Worth It
Sacrifice is very important for achieving financial independence. I didn’t live in a studio with another guy for the first two years out of college for fun! I did it so I could save more money to give myself options down the road. Once you get your housing expenses right, FIRE is much easier to achieve.
Once you achieve financial independence, you won’t feel you sacrificed that much at all. Instead, you’ll feel a tremendous amount of satisfaction that everything you did up to that point was worth it.
We have both been FIRed since we were 34. Me in 2012, and my wife in 2015 as she’s three years younger.
I define FIRE as having enough investment income to cover your desired living expenses.
Financial Samurai Net Worth
In a post entitled, The First Million Might Be The Easiest, I have a chart that highlights my net worth journey. I reached a $1 million net worth at 28, and when I left my job in 2012, my net worth had grown to about $3 million.
I don’t share my net worth figures after I retired because I’ve found it became a distraction to my readers. We have enough to live a comfortable life. The bull market has certainly helped as well.
I recommend everybody follow the Stealth Wealth movement and not display ostentatious wealth for everyone to see.
Thoughts On The FIRE Movement
I’ve been writing about FIRE since 2009 and I’m proud to see it explode in popularity since. As a pioneer of the modern day FIRE movement, I find it fascinating so many new definitions of FIRE have popped up.
FIRE is a moving target. My ultimate goal while I was working was to earn $100,000/person in investment income in retirement. This meant $200,000 for my wife and me. But when our son was born, we bumped up our goal to $250,000. Since we plan to have another and stay in San Francisco or Honolulu, our FIRE income target is now $300,000.
I’ve run the numbers, and $300,000 is a pretty middle class income for a family of four in an expensive coastal city. Our goal is to completely live off the income and never touch principal. Goals are fun because they are motivating.
Being active is a key component of my FIRE journey. It has to be because I have 12-14 hours of free-time a day from not working a day job.
Half those hours are spent taking care of my children. The other half is spent exercising, writing, socializing, and figuring out how to further boost our investment income.
Since writing about FIRE in 2009, new types of FIRE have emerged. They include: Fat FIRE, Lean FIRE, Barista FIRE, and Coast FIRE. The reason why so many types of FIRE have been created is because financial independence is a journey. And sometimes, the journey can be very long and difficult.
For example, Coast FIRE was created to help people who are still very far away from achieving financial independence. Therefore, to make themselves feel better about what they have saved, they come up with Coast FIRE.
Generating Passive Income Is Key
I’ve got a ranking system for the best investment income streams that I follow. Based on my ranking system, I’m focusing my time on online real estate (Financial Samurai), dividend stocks, municipal bonds, and real estate
I’m trying to make my investment income as passive as possible, which is why I sold one SF rental property and reinvested $550,000 of the proceeds into real estate crowdfunding. The cap rate in San Francisco is only about 2.5% versus 8% – 12% for many commercial real estate projects in the heartland of America. Therefore, I’m now earning more income, more passively with less concentration risk.
I’ll probably continue writing on Financial Samurai for years to come because I enjoy the process. Besides, I’d love to teach my children about writing and building a lifestyle business when he gets older. School is much more interesting when you can immediately put what you’ve learned into practice!
Finally, I’m currently working on a new book with Penguin Random House entitled, Buy This, Not That. It should come out in 2022.
Thanks for reading. Here are my Core Financial Samurai Principles To Live By.
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Sam, Financial Freedom Sooner Rather Than Later