A Miserable Debt Free Life

I have a lifestyle that is different to many people, and I have been encouraged to write about it. According to my friends, I am “living the dream”. I get up in the morning and can choose to do anything I want. I don’t work for money any more. I’ve been able to do this since I was 38 (I’m 48 now). I don’t appear to want for anything (material).

This is not a HowTo on retiring young, just a little about my story. Use it as a source of ideas.

Ten years ago I had an executive job in the sat-com industry, and prior to that I had a moderately successful small business, and a stint in academia. Although I was an effective manager, small businessman, and engineer, I was consistently dissatisfied. I did enjoy some parts of these jobs: Digital Signal Processing (DSP), open source, helping people, engineering, teaching thereof, annoying my managers, doing coffee and extremely long pub lunches. Rather than knuckle under and be a good corporate lad I decided to to focus on what I enjoyed most. Especially the coffee and pub lunches.

So I quit corporate life to be a full time “hacker”. I use the term hacker in the positive sense: I develop clever technology. Then, rather than using it to make a profit, I give the technology away in the hope that it will help people. I’ve had some success at this goal over the last 10 years.

My corporate wardrobe is now my pajamas. I spend most of the day sitting on my couch (thanks Dave for the couch BTW!) hacking on my laptop, with daily forays on my bike to a cafe by the beach. This gets me exercise, some social connection, and caffeine.

Once a month I travel interstate to a friends house, borrow their bike, cook for them, and sit on their couch and hack. Mixing a bit of travel with my “work”.

At the moment I average 6 hours of real, focused, head over the laptop work a day. Which is the equivalent of 2 days in a “real job” where you have meetings, managers to annoy, and pub lunches to attend.


  • In my final years of corporate life I listened to podcasts about using technology to help people by a guy called David Bornstein. This idea was quite appealing, a good use of my skills.
  • At the same time a couple of friends (Scott and Horse) put the idea in my head of lifestyles not aimed merely at continual material accumulation. One of them had paid off his house but didn’t see any reason to “upgrade” with more debt; the other just bailed on an engineering career to play volleyball and guitar, living off his savings for a bit. Huh? I found myself admiring them.
  • Volunteer work my Father did for disabled people.
  • A book called Affluenza by Clive Hamilton, which deals with our growing addiction to materialistic lifestyles.
  • Travel. Especially to the developing world, Timor Leste, India, townships in South Africa.

But How Do You Get Money to Live?

Money you need = income – how much you spend.

I live frugally, but am always happy to spend money on my kids (for stuff they really need) or entertaining friends. Most nights I dine in rather than going out, and can cook a bunch of meals in 10 minutes that feed 4 people for $10.

My living costs (including food, bills, housing, schooling, medical, transport) are about $40,000/pa, before any discretionary purchases like new IT or holidays. That is for a household of 2.5 people (I share care of one child).

I drive an electric car which costs very little to drive and maintain, which I supplement with the occasional loan/rental of petrol cars.

My kids go to public schools; my peers spend up to $40k/year on private education. I am home every day for them when school ends, can help them in almost any subject (although they never ask of course as I am their Dad), and attend every interview to monitor their progress at school.

I am not convinced there is any significant advantage from private schools, but acknowledge the emotional buttons and peer group pressure around private education is strong for many parents. My kids are doing pretty well, e.g. one at University, another getting good grades at the best science and maths school in the state.

I get income from a variety of sources, but the total is rather low compared to my peers. And that’s OK. Currently there is some income from SM1000 sales. In the past it’s been from VOIP products like the IP0X VOIP systems and a little contract work. I have some passive income from shares, enough to cover my rent. So it’s a bit like owning my home. These shares have been accumulated over 20 years simply by saving and reinvesting. No get rich quick schemes here.

Planning is good if you want to get somewhere. Here is a simple financial plan, start with $10k, start saving $100/week (5% more every year), invest at 10% (you get to work out where). Repeat for 20 years and you have enough to buy a house, or generate some passive income. Yes I know it doesn’t include inflation, and returns vary over time, blah, blah, blah. Your turn – come up with a model that does include these factors.

In Australia the government gives much of the population “middle class welfare”, a few $100/week which covers much of my food and bills. We also have free public health care. So the country you live in helps. On the down side the houses here are really expensive to buy, an average of $500,000 (10 years average income), and public transport poor. Every country has it’s pros and cons.

I have modest financial skills and good habits. Primarily the ability to spend less than I earn and avoidance of debt. I use a trusted share broker to choose conservative shares, but I decide the overall strategy. Some people like real estate for investment, it doesn’t really matter.

Saving and time is the key. Conversely if you can’t save, it doesn’t matter if you earn $200k. At the end of your time you will have nothing but a pile of debt, useless possessions, an endless need to work hard, broken relationships, and stress.

Every few years I go without income and live off savings for 12 months while I develop a new product. Living off savings for a while has ceased to worry me. However I understand most people are 1 pay cheque away from serious financial trouble. How about you? How long could you live without a pay cheque? It’s a good check on your financial health.

Effective Altruism

I’ve recently realised that working for free to help people is Altruism. So instead of traveling to a village to help less fortunate people I’d like to invent a widget (or part of a widget) that might let 1000’s of villages communicate. Or something like that. At the moment I’m focused on digital voice over HF radio that has many applications, e.g. in humanitarian and remote communications. I’m inventing technology building blocks that let me help the world a little bit, and stretch my professional skills (it’s post doctoral R&D in my field of signal processing).

Now, if you can name an enterprise, you can engineer it. Use numbers to make it better.

So, I’m currently reading a book called The Most Good You Can Do by Peter Singer. This guy is applying a numerical framework to “Effective Altruism”. Engineering it. For example he calculates the impact of donating a kidney (really!), or saving a persons life with $x versus preventing blindness in 10 people with the same $x. Is it better to work for 200k and donate 150 to a charity, or work for 50k in the same charity? Quite an easy to read book, but some fascinating ideas.


I have to think carefully and be sensitive to connect with the life of people with “real jobs”. When my friends head off to work every day, it’s a mental shift for me to understand. Yes I understand we need to be fed and housed. However I note a large portion of this work seems to be around paying for things we don’t really need, or making minimum payments on enormous debt. Wage slavery? But hey, my bank shares keep going up, and the dividends keep getting bigger, so who I am to question this system!

Until age 38 I was very focused on material accumulation. I had a Porsche 911 (called Helmut), several investment properties, and several pairs of trousers. At that stage I just ran out of things to buy. That was disconcerting for someone who came of age in the 1980’s. It felt, inexplicably, like a miserable debt free life. So I had a bit of a think. It’s taken me a little while to shift my attitude to money, however I am gradually letting go. Old habits die hard. I still feel bad when not saving and accumulating.

Re money all you need is the ability to save and time. Many people seem compelled to piss every cent they get down the drain. This is encouraged by the “growth paradigm” that governments push, easy debt, materialism, and lack of financial literacy.

Here is how I’m making my kids rich. It’s working too – they are in a better position than I was at their age and a million miles ahead of their peers. Or for that matter a lot of people my age (30 years older than them). It’s not just their net worth either: I get them involved, building their skills in handling money and investing. Showing a 9 year old a dividend statement. Getting a 17 year old to build a spreadsheet predicting growth of his assets over 10 years. Giving a child part of my web business to run. Making them wait for new material possessions. Not giving them everything they want, of that their friends have. Forming good habits early.

I struggle with the idea of debt for non-essential items, or huge, barely serviceable debt that is impossible to pay down quickly. Certainly not for a bigger house or a $500 outfit or gadgets “paid” for on a credit card. Or strongly depreciating items like cars (unless it’s electric of course). Useless debt turns the financial model above on it’s head. If you waste $100/week now YOU get to pay the banks $500k over 20 years. Then go back to work to do it again for another 20!

I am very fortunate and feel I must help others with my good fortune. We are all going to die one day. Everything that matters to us, everything we ever owned, every problem we have – will all be dust. Quickly forgotten, after a few kind words at your funeral. However helping improve the lives of others matters. That can endure. I can’t imagine a life where I am not helping others. Working just for more toys or my own needs is not enough.

So now I’m going to sit on my couch, do some hacking, then give it away.

And no – you are not going to see me in my PJs!

Reading Further

A Miserable Debt Free Life Part 2

37 thoughts on “A Miserable Debt Free Life”

  1. Awesome post, thanks for sharing this inspiring post. I’m working towards being I’m in a similar position to you too.

    However, your post title could do with some work, I’m pretty sure you mean “A Misery Free and Debt Free Life” rather than a “A Debt Free Life that is Miserable” that your current title suggests :).

    1. Thanks Tim. It’s a line from within the post that describes a turning point that lead me to my current life. I was debt free, and yet a bit lost. Like a lot of music, the title relates to a single line in the work. I kind of like the phrase too….

      1. The title should stay exactly as it is – it is what drew me to read this article. In my early thirties, I am at a similar mindset where you were ten years ago. I’ve worked hard since my early teens, being raised with the idea that money was the key to happiness, and now I find I have enough money to do pretty much whatever. I have no debt, and I could buy a mansion and a Lamborghini today, with cash. If I handle my reserves right, I will never have to work again.

        Mind you, I haven’t bought that mansion, nor that Lamborghini. Once I realized my position, I started looking around what I could buy, and eventually realized that none of these things will actually improve my life that much for more than a moment. Ironically, as soon as I had the money to buy everything I might want, I immediately ran out of things to buy, without spending a dime, and I am living a miserable debt free life.

        How will I spend the next X years? I don’t know, but this article gave me some ideas, thank you for writing it.

        1. Ahh, a kindred spirit! Yes I also have other “successful” friends in similar positions – everything material sorted, but not quite sure what to do next. There are some down sides, for example everything I do requires motivation. I can get up in the morning and do nothing. I don’t always enjoy my signal processing R&D – it’s damn hard work. It’s a job that doesn’t pay very well (if at all). I still have to do management, of my own time and other volunteers. People problems still exist. So I have to push push push every day. I’ve had romantic relationships where my partners “really struggle with my lifestyle”, or I have trouble connecting to theirs. Sometimes it’s nice when you have to get up and go to work – gives structure.

  2. Thank you for this. I needed validation for my own dreams. I’m recently a father at 35. She’s two now. I just don’t want to work when I don’t have to anymore. It doesn’t seem like how much I make makes any difference as there’s never enough for my wife :).

    1. Lol, my wife used to say “it doesn’t matter how much you make, I can spend it faster!”.

      But seriously – being on the same page with financial goals and values as your partner is really important, as is transparency into each other financial lives.

    1. So long ago .. I can’t recall. Around the end of 2004. I listened to it on an ipod mini with a hard disk inside! It came for a site called “IT Conversations” and had stories of people installing solar panels in rural Brazil, stuff like that. If you can find it pls send me a link!

  3. David:

    Thanks! In this post, you didn’t mention your projects, but they’re incredibly inspiring, like Village Telco. Those projects will make subtle, but significant changes in society. If you were to die tomorrow, you WOULD be remembered long term for choosing to invest your life/time into those projects.

    Again, Thanks, for writing it down AND doing what you do.

    1. Thank you, it’s wonderful that I can inspire and influence people. That’s a useful way to “improve the world a little bit”.

      You know I’m not sure I want to be remembered … just to know that the oxygen I consumed while on this planet helped in some meaningful way. A small ripple of benefit down to future generations would be enough.

  4. Pretty cool stuff, David. I’m in my 30’s and early retired myself from a career in engineering. I don’t spend hours per day hacking on my projects, but I still do productive stuff even though it’s not full time 9 to 5 type stuff (been there, done that, got the paychecks to prove it…). Work can be fun and interesting in moderation, I just never liked the structure and the fact that you might get yelled at if you decided not to show up for a day or a week or whatever.

    We live on a fairly modest amount (roughly USD $33k/yr), which is fairly low for a family of 5 according to developed world standards. We just live a life of stealthy luxury on the cheap. International travel most years (8 weeks this year, 5 wks last yr), we own 2 cars, decent sized house, eat fancy foods we cook ourselves, etc. Doing more with less is a definite talent that we possess. :)

    1. Nice one Justin. The fact you even know your living expenses tells me a lot! Yeah and what’s with job security? The idea of doing the same job forever appalls me.

      1. I liked job security while I needed the warm fuzzy feeling of a security blanket back in the days of mortgage payments, kids to bet fed, etc. Once I had enough assets to last for multiple years of unemployment, I got a little smirk on my face and decided job security wasn’t important at all.

  5. I’m 26, and on the same path. Hoping to leave the corporate ladder at 34 when I hit a mil, and do exactly what you do. I do the same kind of thing that you do in excel to predict growth. This year’s goal is to invest $850/month, and allow the magic of compounding interest to take over using mREITs. Your article was a great read, and I hope more find this path to enlightenment.

    1. Nice work Justin. The process of setting goals and planning is so important. Tends to align your life, orient you in the right direction. At 26 you have a lot of time on your side. If you are not doing it already, also consider using your spare time to develop other useful skills, e.g. for me it was small business (the technology skills came easily for me, but business was a challenge).

  6. > Yes I know it doesn’t include inflation

    The American middle class has a reflex of shying away from looking at the tax. What if you had a reflex of turning your head away from looking at the power draw of the equipment you build? Would the stuff you build work?

    > In Australia the government gives much of the population “middle class welfare”, a few $100/week which covers much of my food and bills. We also have free public health care.

    That’s not free, you’re paying for that service plus a lot of paper-pushers to manage it. As a child buying a toy with my own money I once asked my mother to contribute the tax, which she encouraged me not to think about and plan for. She did, but her cognitive dissonance was entertaining. What? Tax is a cost as real as any other? Santa doesn’t gift it to me by magic and now *I* have to provide it? Why am I left holding the bag? How can I vote smarter next time?

    Religion has trained this reflex for a very long time. Religion teaches it is evil to create or even notice if your outputs are more valuable than your inputs. It is more evil to retain a portion of your outputs to improve your own situation (“profit”). Productive work and self-improvement as a goal is evil. Consider who benefits from this teaching. If you want to keep chattel slaves or debt slaves in their place, teach them that working to rise out of their place is evil. Whereas, the correct reflex is thinking, it doesn’t matter how much you make, it matters how much you can keep.

    There is a secular religion’s culture that advocates voluntary simplicity, tiny houses, and muscle-powered transportation. But scratch the surface and it zooms right past the sales pitch of being thoughtful about how you spend your life’s time, and crashes into its real goals, self-loathing and voluntary human extinction. By every biological scoring method we apply to every other animal’s behavior, self-loathing is defective and insane. The correct goal is the combination of increasing material prosperity and health, and decreasing unpleasant work and pollution.

    It would be clear thinking and honest to replace this fantasy chart with a real one that accounts for currency inflation and tax. That would reveal on paper what you already know, that financial laws have been carefully arranged to make it impossible for ordinary people to plan for retirement.

    There is an old testament bible story about ancient Egypt. The government collects 20% of income during 7 years of good times and stores it. During 7 years of bad times the government gives that same income back to the people who produced it, but with political strings attached so the people who produced it declare their status changing from citizens to slaves. That status changing is a voluntary decision by the citizens, the government can’t force it with soldiers and guns. This is a triumph of religion, the enforcement mechanism is malware placed in human brains which causes them to declare their status different. America improved on this scheme because they didn’t store it. Social Security was a Ponzi scheme from day one, all savings were redistributed away each year and there never were any savings to be reclaimed. This is like a conquistador burning the boats so the invading army can’t retreat.

    1. “make it impossible for ordinary people to plan for retirement”

      Nope. I’ve done it, as have many others.

    2. @Anon Can you give more detail on what you mean by “material prosperity”?

      I share many of your views. Yes, 10% is a little high and I would use a lower number unless I had a good reason to think I could produce 10% gains after tax and inflation adjusted.

      I think you are alluding to the fact that the early retirement community as a whole seems to focus on the cutting and has no coherent views on what to actually do with your life. And many of the people who retire seem to have no idea themselves. In fact I follow one blog where the poor girl went back to work after a whole month because she decided she “loves setting quarterly goals” for her subordinates.

      FWIW david I think you are doing pretty well.

      1. > Can you give more detail on what you mean by “material prosperity”?

        More physical possessions you enjoy having, made available to you because technology makes manufacturing cheaper.

        > I think you are alluding to the fact that the early retirement community as a whole seems to focus on the cutting and has no coherent views on what to actually do with your life.

        I believe the “voluntary simplicity” movement focuses on the cutting because the pain of cutting, the tears at relinquishment of something that was meaningful to you, is the emotional goal. They take a vow of near-poverty. The last thing the voluntary simplicity movement wants is for someone to be joyous and free because they’ve stopped wasting their time dragging around meaningless possessions.

        > And many of the people who retire seem to have no idea themselves.

        Meaningful work is a necessity for mental health. But it only has to be “work” in the economic sense of producing something or helping people, not in the sense of being painful to do.

        1. “….the tears at relinquishment of something that was meaningful to you…”

          This is a big assumption. It’s quite the opposite for me. I have relinquished (or refused to acquire) a lot of material items as I found they have no meaning to me. I simply don’t desire them. I have everything materially that I want. I choose to live frugally and below the average level of “material” goods, however I am extremely time rich and enjoy other lifestyle aspects my peers admire greatly. In contrast I have several good friends who retired early and live a very affluent lifestyle. Common factor is we have choice. And time – which is the scarcest resource of all.

        2. @Anon
          >The correct goal is the combination of increasing material prosperity and health, and decreasing unpleasant work and pollution.

          >More physical possessions you enjoy having, made available to you because technology makes manufacturing cheaper.

          But why does acquiring possessions make a person happier? I have found that I get no increase in happiness from acquiring possessions, beyond their utility in pursuing other goals I have that do make me happier.

          For example, one might say the goal of their life is to maximize their projection of wealth, in which case buying nicer things would get them closer to their goal.

          In fact I find the acquisition of possessions without a good reason morally suspect because you are wasting resources, including people’s time to produce them, when they could be used to do something productive.

  7. I find it unforgivable that you happily sign on for the “middle class dole” and also advocate your million dollar successes.

    But opportunistic people are what they are, even when they feel they are doing ‘the greater good’ for poorer parts of the world. Your contributions to the economy while happily benefiting from socialist ideologies make me somewhat frustrated with this seemingly idolized way of living.

    1. Hi Benjamin,

      Yes my last girlfriend felt that way, which is one of the reason she’s my last girlfriend :-)

      I pay my fair share of taxes, and I takes back what is legally mine to take back. Based on a fair charge rate for the post doctoral R&D I give away I think the Australian government is getting rather good value.

      If I was pissing my money down the drain and crying poverty as my credit card was overflowing would you feel better? Is someone who started with the same opportunities as I but spent all their money more deserving than I of these payments?

      Although in a broader sense I agree with you – I wouldn’t mind if Family Tax A&B (the middle class dole here) went away – it is really just a political sweetener. Few (like me) really need it, the government has just convinced us we do. I think you have to earn over $150k/pa to not get it. I’d much rather see it go to only those who really need it, and use the $ for public transport, hospitals, teachers, or foreign aid. But that’s the system, and for sure – I am opportunistic enough to work it! Muhahahahha.

      – David

  8. Hi David, thanks for this post I’ve also tried to do something similar.

    I quit my job about 5 years ago to explore life, and also ended up using my skills in technology to help others. I didn’t have the savings to do this forever, but have basically worked backwards from year 5 on your chart 😉

    My challenge now is to re-join the workforce, which now seems like a strange place indeed…

    1. Fine Business Malcom, I bet it’s been a great experience for you. I often fantasize about getting a “real” job, but the only thing that really interests me in the corporate world is doing coffee and long, boozy lunches. So I don’t think it’s fair to an employer to subject them to that!

  9. Thanks for the very inspiring article!
    However I’d like tips because invest at 10% is not something I know how to do. Perhaps some pointers?

    1. In my part of the world it’s possible to get (over the long term) 7% capital growth and 4% dividends on blue chips shares. However – TBH I think that’s where where the “99%” perspiration comes in (I’ve given you the 1% inspiration). You need to work out how to find a suitable investment. It’s part of the deal. Like knowing your spend rate and the skill of spending less than you earn.

  10. >can cook a bunch of meals in 10 minutes that feed 4 people for $10

    Do you have recipes you could share? We enjoy cooking in our home, but the time with two, and soon to be three little ones makes things difficult. A bunch of meals in 10 minutes for such low expense sounds awesome!

  11. I read this late last decade and found it quite inspiring


    more on the downshifting trend:


    Producing more material stuff, creating ordered “things”, represents a local assembly of reconfigured atoms, with each new “thing” representing an ultimately transient local decrease in entropy, and some psychic dividends in the excited consumer, but this local order requires energy, and this unavoidably increases the universe’s entropy elsewhere, both in terms of heat, and the by products of our energy consumption – i.e. dense hydrocarbons turned into diffusely scattered, warm, combustion products.

    Increasing specialisation in society is only made possible by ever increasing complexity. Whether it be early agriculture harvesting biomass in the form of grains 10,000 years ago to allow specialistion within the village, or modern industrial economies, with hydrocarbon fuelled supply chains spanning the globe, increased complexity requires correspondingly increased amounts of energy.

    Conspicuous consumption is ruining the planet and polluting the biosphere, but it is the driver of economic growth and the god of Free Markets.

    +1 for saying no to conspicuous consumption.

    The nice thing about the intellectual commons is that if two people share knowledge, both people then have that knowledge.

    It is much harder to share a porsche.

    OTOH, Porsches, and conspicuous consumption generally, continue to be popular as sexual signalling systems

    “Peacocks, Porsches, and Thorstein Veblen: Conspicuous Consumption as a Sexual Signaling System”


    The middle class urge to be seen to consume conspicuously seems to be a hangover from feudal times


    Is it any wonder everyone wants to be seen with a newer, bigger smart phone?

    1. Well written. I love the 2 paragraphs starting “Producing more material stuff”.

      There is a middle ground where complexity does not necessarily require more energy. Free software that provides some utility running on a low power CPU is a good example. I can use it to work from home (saving a lot of hydrocarbons, transport infrastructure, and an office building). Or to send a message efficiently over HF radio (less power, use of spectrum resource, and saving a days walk if I am a poor person in a developing country).

      Economic tools like mass production and specialisation can be used for good – if geared to making phones or computers that last for 100 years, rather than consumption.

      This talk by Eben Moglen was very influential to me. Software is the economic engine of the 21st century. If it can help people, and can cost nothing to reproduce, then ethically it should be free.

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