Have you ever wanted to fire your boss? What if you could? Tell your boss to go F*** herself. Just walk away, and not be concerned about the consequences. If you really burn bridges like that, you may need enough money to cover your expenses for a couple of years – enough time for a completely fresh start. This is the concept of FU Money. It is more than just an emergency fund, but perhaps not enough money for complete financial independence. It’s enough to burn your bridges and not look back – if that’s what you want to do.
The Three Degrees of Financial Freedom
The first degree of financial freedom is the Emergency Fund, enough savings to cover an emergency, to keep food on the table and a roof over your head for a few months if you are out of work. But don’t stop there, the next level of freedom is FU Money: enough money to completely walk away from your career, and start something completely different. Think you’re not going to have a mid-life crisis? You may want the freedom to try something completely different. Just because you have FU Money doesn’t mean you will need to use it. But it sure does open up your options in life.
FU Money Is Not About Burning Bridges
Now, I won’t say that it’s a good idea to burn bridges. But it sure does feel good! Especially, if your boss is evil or you’ve been really burned by corporate politics. Sometimes it would be nice to literally tell your boss to go F**** herself. Nevertheless, it is not a good strategy to burn bridges. The adults in the room know that you can never predict how a burned bridge may come back to haunt you.
But FU Money is not about burning bridges, it is about having options. It’s about having the freedom to change your focus, move on to something new, to try something completely different.
Are You Ready For Your Mid-Life Crisis?
Mid-life crises come in many forms. It can impact your relationships and your job. If you decide you want to completely start fresh in a new career, it will take some time before you are earning as much again. You may want to go to back to school. You may want to build a business from scratch. You may want to take a risk at your dream. Any of these things will cost you, and you don’t want to have to completely sacrifice your financial future to do it. This is what FU Money is for – it allows you to follow your dreams.
I am myself about to launch my Corporate Escape Plan. I will be taking a sabbatical of sorts. I don’t intend to quit working entirely, because I enjoy (certain) work…. just not so much of it. I want to get outside more. I want to focus on the relationships that are important to me. I have not achieved true financial independence yet, but I am confident that I will be able to earn enough money in the future. This sabbatical would not be possible if I didn’t have sufficient FU Money.
You Need FU Money Even If You Love Your Career
“But, I love my job, and I love my career. My money would be better spent on a BMW” No, no it would not. We humans are often plagued by short sightedness. A solid workplace environment can turn sour faster than you think. Your career take a dive on just a single email. There are no longer any safe positions, and there is nothing more constant than change. I guarantee you, change is coming to your career. You’d better have options.
You need to have enough money to make a choice, rather than be forced into a future that you may not like.
How Much Do You Need?
FU Money is more than an Emergency Fund, but not enough to be completely financially independent. Emergency Funds are generally thought of as 3-6 months, or perhaps 1 year worth of expenses. Financial independence, on the other hand, is generally considered to be achieved if you have 25x your annual expenses. So, I suppose anything in between 1x and 25x your annual expenses can be considered FU Money. That’s a pretty wide range. Maybe another way to think of it is that FU Money needs to be enough to sustain your mid-life crisis, or to give you the options you want in life. It just depends on your situation.
In reality, it’s all part of the same road to financial independence. You should not stop saving just because you have a healthy Emergency Fund. The same applies once you have enough money to say “FU” to your boss. You are still not completely independent. You need to continue saving and continue hustling – you just have more options in life.