Where did the money come from?

After multiple discussions with people who have been critical of the idea that financial independence is possible, I think I’ve finally managed to define for myself one of the key issues that stops people from believing in FI – they just don’t understand where the starting capital comes from and therefore conclude that something shady must happen to get started.



Counterintuitively this is also one of the key reasons why I think financial blogs in Estonian have become as popular as they are now – you can see actual numbers of growth from the start of a portfolio that makes FI seem more reachable. There are multiple issues that I feel have compounded this problem (alongside overall pessimism), so I thought I’d try to figure out where the money does come from.

1. People born with a silver spoon in their mouth

For those unfamiliar with this expression, its mostly implies people who were born into wealth. It doesn’t have to be significant wealth (though it can be), but even a little bit of an extra boost is a significant help on the path to financial independence.

For example starting off your life with your parents just giving you an apartment to live in. Yes, it’s not just a pile of money, but not having that one extra monthly expense is a huge boost to your finances. Quite often these people underplay the impact their extra “help” has had, which tends to annoy people. If you were born lucky embrace it, thank your parents and don’t tell others you just “worked hard” 😉

2. Being in the right place at the right time

I’d say this is probably a large portion of the people who have reached FI or are working hard towards it. At some point lady luck may smile on you and you’ll end up with a great opportunity that comes with a nice financial bonus. This is complicated since people will often try to reason why such a thing would never be possible for them – oh, you got lucky… oh, it was random chance.

I’d say people who went and sold books in the US in the early 2000s are a good example of this. It doesn’t mean that they didn’t work hard, or that that it was just luck, but you have to admit that in the case of Estonia those first people who came back from a summer with 100K+ kroons when that was a huge amount of money did have a certain leg up on everyone else. I recently read a blog where someone had an 80% savings rate… (impressive until you realize that was from a 4000€-ish salary, definitely top 5% of Estonian wage earners).

3. Working hard (and working dull)

This is by far the least glamorous way to get your starting capital but most people who aren’t fortunate must grind to succeed. While with other strategies people tend to curse Lady Luck or missed opportunities, then with this option people just tend to get demotivated rather quickly.

Many people have been asking me recently where I got the money from to buy my first rental apartment since it’s such a large amount of money. They’re always very unimpressed when I tell them that it mostly involved working like a dog for more than a year by both my husband and myself. Sacrifices need to be made for that first push and a lot people stop when the going gets tough (and it will, working like that will get to you physically and mentally).

The importance of talking about beginnings

When you read most personal finance books they are about people who are already millionaires (since why else would you read a book by them?) Most of them focus on their overall ideas and are super optimistic about just getting started and doing stuff and most of them only share some anecdotes or “learning stories” from their childhood when answering the question of how they get started.

In many ways it’s an issue since leaving those beginnings fuzzy makes people doubt your claims. I’ve developed a new question to ask new people I get into contact with – how did you get started? You’d be interested at the answers or the lack of answers that people give. (Also, how many of those start with the words “I got lucky…” or “Someone helped me…”.)

A lot of people do not want to share how they started (and one of the reasons is likely a bit of a silver spoon or lady luck issue) and I think that’s a huge problem because it makes a lot of people who are working hard think that they are doing something wrong since they aren’t getting the same results.

They aren’t getting to x amount of passive income or reaching FI super quickly. No matter how much “hard work” is involved, you don’t become a millionaire by 30 “just” from buying stock every year or working hard at finding rental apartments and I think that’s a dangerous myth to perpetuate since it actually demotivates people.

25 and now what?

My motivation for starting this blog is quite simple. I am turning 25 and have decided to take a deeper look into my finances. It is time to do more than just think about improving my finances.

I won’t be so negative as to call it a crisis of some kind, but when looking back to the things I’ve done in my life so far, then some things have greatly exceeded my expectations while some have fallen quite far from the marks I set for myself when I was younger.

This blog is my attempt to organize my finances and to document my thoughts and my journey to financial freedom. I must admit that I’m nowhere near as hardcore as a lot of the financial bloggers that I read on a daily basis. Half the reason is that I value experiences and enjoyment that life offers, the other half is mostly just genuine laziness and lack of discipline.

I still believe though, that financial success can be achieved even by taking small steps at a time, as long as you think of money as your friend, not your enemy.

The concept of early retirement and financial freedom/independence are fascinating but to some extent they seem like very American ideas. I’m being realistic in that I won’t retire by 30 or 40 like some of the prolific financial bloggers but I do believe it’s possible to reach some sort of a point where money isn’t such a huge problem and I’d have a significant monthly passive cash flow to simplify my life.