[Dual-Income Teachers] Our "Shortest Route to FIRE" Living on 120,000 Yen a Month
Hello! This is Teacher Chaso🧑🏫!
In the midst of the daily grind, do you ever find yourself wondering, "How long will I keep working like this?"
By thoroughly organizing our household finances, the options of "Side FIRE or Full FIRE" have become a realistic possibility for us.
This time, we are revealing "our realistic living expenses" which changed a bit after our 👦 child was born, along with the surprising simulation derived from them.
1. Our realistic monthly living expenses as a couple (Total: 121,000 yen)
We make full use of teacher benefits (housing allowance) to keep fixed costs as low as possible.
Breakdown of the "realistic household budget" for a dual-income teacher couple in their 30s
We work together as a couple to keep our monthly living expenses to around 120,000 yen. The breakdown is as follows.
[Fixed Costs]
Rent: 30,000 yen
(We make full use of the housing allowance, which is a teacher benefit. We are able to live in a spacious 3LDK for this amount.)
A new condo next door of the same size costs 30 to 50 million yen... thanks to the allowance, renting is overwhelmingly cheaper!
And what's shocking is that until last year, our rent was 20,000 yen😂 Even with the increase, it's still cheap!
Communication expenses: 6,000 yen
(3,000 yen per person x 2 people. We are wisely choosing Rakuten's budget plan.)
[Variable Costs]
Utilities: 15,000 yen
Miscellaneous expenses: 20,000 yen
(Baby goods and daily necessities. Even though we are raising a child, we can keep it within this range with some ingenuity.)
Food expenses: 50,000 yen
(This is a justified investment to balance health and time-saving for a dual-income couple. Expenses increased because we buy slightly more expensive ingredients to make fresh baby food.)
Point!
Miscellaneous expenses increased after our child was born, but because we have the "Child Allowance", the actual household burden is not much different from the days when it was just the two of us (under 100,000 yen per month).
2. The form of FIRE you can aim for with "1.44 million yen in living expenses"
If your annual living expenses are about 1.44 million yen, applying the "4% rule" from asset management means that your living expenses can be covered with the following asset amounts:
• 4% yield: 36 million yen
• 5% yield: 28.8 million yen
• 6% yield: 24 million yen
• 7% yield: 20.57 million yen
Some of you might have thought, "Huh, that's surprisingly low?" That's right. If you optimize your living expenses, the "goal (asset amount)" you should aim for is brought much closer.
3. [Simulation] Is 90 million yen by age 40 not just a dream?
Suppose we take advantage of the strengths of being a dual-income couple and invest 5 million yen annually from one person's income.
5 to 8 years of investment
Assets to cover living expenses are built (achieved in early 30s!)
Continuing for 18 years from age 22 to 40
90 million yen in principal alone
Of course, this is an optimistic scenario depending on annual income and life events, but if you combine the teacher salary system with savings, it is fully possible to be within the FIRE range by age 40 if you keep your living expenses down. We are aiming for this "simple and strongest future" while securing pocket money (30,000 to 50,000 yen each) to keep our hearts enriched.
⚠️ In this case, pocket money is a separate economy. This is FIRE for minimum living expenses, and if you want to secure money for fun, you need much more money. ⚠️
Well, if you can achieve living expense FIRE, that should be fine! You can work hard for fun money, right!
If you can achieve living expense FIRE, full FIRE will also come into view as an extension of that, so let's aim for living expense FIRE first! 😂
What is your "minimum living expense"?
The first step to FIRE is, more than earning, knowing "how much we need to live happily".
Even with children, we are living richly on 120,000 yen a month.
"Side FIRE and get involved in the education field as a part-time worker"
"Full FIRE and travel the world"
Doesn't that kind of future suddenly become realistic just by putting it into numbers?
Thank you for watching 😊