9 Year Plan to Financial Freedom

Back in 2010 when I started this blog I set out a goal to reach financial freedom by the year I turn 35 years old 😉 I didn’t know exactly how I was going to do it but I knew I had 12 years to figure it out. Fast forward to today and I’m 26 years old with only 9 more years to reach financial independence 🙂 According to my latest net worth statement from last month, here is a simplified look at my current balance sheet.

Home = $252K
Farms = $325K
Stocks (Inc Retirement Funds) = $161K

Total debts = $535K

So how do I plan to reach financial freedom by 2022? It’s simple. Invest $5,000 a year into my stock portfolio for the next 9 years. In 2022 sell my farms and use that money to pay off all my outstanding debts. Live off dividend income forever 😀

Pretty straight forward eh 🙂 If Canadian farmland appreciates by 4% a year for the next 9 years, then my farms should be worth about $463K by the year 2022. After commission and capital gains tax I can expect to keep about $420K for myself.

Right now in 2013 I have about $535K of total debt. Next year I expect to pay down $10K of it simply by making the minimum payments on my mortgage, farm loans, etc. And the year after that my debt should be down another $11K as more of my payments will go towards the principle. I’m sure you’re all familiar with a loan repayment curve 🙂


After the entire 9 years I should only have roughly $420K of debt left without having to make any additional lump sum or accelerated mortgage repayments. I will use the proceeds from selling my farms ($420K) to completely pay off this remaining debt. Hey that worked out pretty well! This also answers the question people often ask me, “Liquid, how do you plan to pay off all your debt?

Without a mortgage or any other debts my total living expenses today would drop to just $10K a year which includes fun money 🙂 If inflation averages 2.5% annually then I’ll need $12,500 of income to sustain my current lifestyle by 2022. This money shall come from my dividend paying stocks.

My stock portfolio today is worth $161K. By contributing $5K a year, and assuming a 5% annual return, in 9 years it should be worth about $305K. I can rebalance this portfolio and have a mix of stocks and bonds to act as a long term income fund for myself with an annual distribution of $12,500, or about 4%. The entire stock portion of the portfolio will be made from a selection of dividend aristocrats so my dividend income should at least match inflation going forward from there (^_^)


So as long as I save $5,000 every year to invest, and hope for a conservative rate of capital appreciation on my assets, I will be financially free by 35 🙂 Wow, it sounds almost too good to be true 😎

Some say the average working citizen is getting poorer because of stagnant wages and higher taxes. But let us think outside the box 😀 Instead of counting on wage increases alone, why not also use investments to grow our wealth? Long term returns in a diversified portfolio will almost always beat wage inflation 😀 And instead of paying higher income taxes we can make better use of capital gains tax or use tax efficient vehicles. For example, any profits we make from Canadian stocks in a TFSA is completely tax free 😀 And the 2 stock purchases I blogged about last week was bought in an RRSP which has tax deferring benefits.

If I can afford to purchase a condo, invest in growing companies, and buy high quality farms, then so can other middle class households 🙂 We all have access to the same information on the internet, to the same financial markets, and to bank loans. We all know how to make wise financial decisions because I often blog about my investment strategies 😉 So the only difference between retiring at 35 and 65, is having the confidence to take action (^_-)

Random Useless Fact: This is how investors see the world (click image to largify.)


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12/29/2013 3:50 am

I wish you the best of luck. You’re definitely on your way to achieving this and most important, you have a plan. I wish I would have been smarter with my money at your age. I’m 33 and I’m planning to achieve financial freedom at 55 (freedom 55 commercials was my inspiration haha) I’m curios about your stock holdings I’ll dig your other posts I think I remember one where you list them. Here’s a few of mine DDD, INTC, SIRI, KFN, DVAX and a few OTC stock. I need to find myself more long term stuff though, I feel my picks are very vulnerable at times even though I’m in the green with all of them.

12/29/2013 5:07 am

Where there’s a plan, there’s a way!

I’m impressed you can live off $10,000 – $12,500 a year even being debt free. That’s cheaper than living in places such as Thailand or the Philippines! Is Canada that cheap? We all know that the average Canadian is worth over $400,000!

I’d love to see a budget outline post to get motivated to save more money myself. I’m spending way too much.

12/29/2013 8:44 pm

Not bad! Any plans on taking a lady out to a fancy restaurant though? That could be $100-$200 right there!

hungry hungry artist (@blerghhh)

No clue how you live on $150/m for groceries… I’m more of a $500/m kind of guy.

09/24/2014 7:10 pm

I live on $50 per week grocery, I could buy all the fruits, veggies, and meat I want. I cook once a day and would eat the same meal 4 times. If you don’t buy processed food, it’s really cheap and quality food.

Investing Pursuits
12/29/2013 9:40 am

I read somewhere that the average wage income per household in the United States increase by only 10% since 1970. With companies sending their jobs over seas to reduce their cost and people taken lower and lower wage jobs in order to survive. The answer is to think outside the box and find ways to have multiple sources of income.

You are definitely thinking outside the box (with purchasing 2 farms) along with purchasing high quality equities that pay dividends. I think you will be reach financial indepence before 35.

12/29/2013 9:59 am

*fingers crossed* for your plan to come to fruition! Like Sam, I am amazed at the low spending plan. Does that account for property taxes and condo fees, too? We’re hoping for FI before our 36th birthdays as well, but since we want to spend more than you and about half as long, we’ll be putting a bit more than $5K/year into our stock accounts. =)

Steve @ The Silver Maple Leaf
Steve @ The Silver Maple Leaf
12/29/2013 1:06 pm

Reading your posts always gives me some inspiration on our own journey towards FI! It’s cool that you’re local too 😀

Laura / No More Spending
Laura / No More Spending
12/29/2013 1:33 pm

I like seeing your budget breakdown – inspiring! We’re aiming for <£1k living costs w/o the mortgage. Take away the company car though, and it would be a struggle.

Good plan Liquid. Things may change, but you're definitely on the right track.

12/29/2013 9:40 pm

Sounds like a good enough plan. How did you decide to start investing in farmland?

12/29/2013 11:52 pm

It’s a long road but it’s a right one to take. It might take a while but it has to start right away because we are in deep trouble the longer it takes to get finished.

Kyle @ Young and Thrifty
12/30/2013 9:11 am

Cool post. Since I only began reading your blog about six months ago I might have missed this post, but do you have anything on how you got your farmland or how you decided to get into farming? I’m a little less ambitious you and plan to be financially independent by 40 instead. Also, if you don’t mind me asking, where is your farmland located?

12/30/2013 3:03 pm

One of my professors used to always say, “If you don’t plan, you plan to fail.” I think you’ve got a great plan in the works. Your well diversified. Your going to exceed $1M net worth by the time your 35. Thinking back what some of the old farmers used to say (the guys who went through the depression), “sell your wheat, hay, and cows… but don’t sell your land.”

If I may make a suggestion. I know you encourage continuing education as a method to increase one’s ability to earn a larger paycheck. I did something similar for career purposes by returning to the University. But not only was I able to benefit myself with expanding my knowledge, I was also able to use night classes to meet new people. I know how hard it can be to meet women when one does not frequent bars and clubs. etc. Something to consider.

12/31/2013 3:26 am

I like the way that you have laid out your plan as opposed to some that says I’m going to retire in X years with no actual numbers. I’m currently over a million dollars in debt (1.3 million to be exact) thanks to my home and rentals. To financial independence.

01/02/2014 3:10 pm

I live in Hawaii which is really expensive. On my blog I posted how I got there under my millionaire in debt post.

02/08/2014 5:00 am

How do you plan on spending your time once you reach financial freedom?

On the one hand you could probably live forever if you maintained your current lifestyle if you stayed single, had no children and the dividend distribution amounts increased over time for all of your stocks (or you sold and buy new ones that did if they discontinued dividend distributions or reduced the dividend distribution amounts too much). But on the other hand, won’t it be hard to re-invest if you lived solely on your dividend distributions? At $12,500/year, I imagine your re-investable savings would be low or non-existent if that’s your only source of income.

Or am I missing the point? Is the point that you no longer have to work, so you can work at whatever job, project, venture that you want to without worrying about how much or little money it makes?

07/27/2015 12:45 pm

Great blog! So I’m guessing you aren’t planning on having kids? Just wondering if you thought about it and if this would throw a monkey wrench into your plans. Could you still make it work? Thx.


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