Financial Independence: build financial resilience for unexpected expenses

Build your resilience.

What’s up big dreamers. When my life says ‘surprise expense!’ I say ‘emergen-see ya later!’ 🚨💸✌️

Ok, let’s talk about financial resilience through Financial independence (FI). FI is building up enough wealth to handle the curveballs life can throw at you: unexpected expenses, getting laid off, helping a family member in need, all while being able to sustain your current lifestyle and not impacting that inheritance for your kids. Too good to be true? Let’s break it down, hi-ya! 🥋

No cap, recap: FI means your income—think investments, savings, or side hustles—covers your expenses without a “normal” paycheck. It’s a safety net for families in a world where layoffs hit without warning (like the 2025 market dip from those tariff hikes). It offers peace of mind when for the unexpected, like medical bills or replacing that AC.

Take Sarah and Srinivasananda, a couple with three kids and a $200,000 income. They were drowning in long hours and debt, despite the big paychecks. Then they got smart about FI. They crushed their high-interest credit card debt. That weight gone, they built an emergency fund—six months of expenses in a high-yield savings account. They slashed spending (replaced their Benz for a Honda), and poured 40% of their income into a mix of index funds and Treasury bonds. Within a few years they gained enough wealth to weather almost any recession. Ten years later? They reached FI, their investments throw off enough cash to cover their annual expenses.

Let's see what happened next. In early 2025, tariffs paired with large government layoffs tanked the markets, stocks dropped 15% within a few days. Families who didn’t have financial resilience, panicked. Not Sarah and Srinivasananda. Their emergency fund and Treasury bonds—low-risk, steady assets—gave them peace, knowing they don’t have to touch their stocks since they have enough for a few years in low-risk assets. They rode out the downturn and uncertainty, sipping chai while others scrambled. That’s the power of financial resilience: you don't let unexpected life events control you, you hold the powa! 💥

Here’s how we built financial resilience for unexpected expenses:

1. Learn from the pros: Quit Like a Millionaire, The Simple Path to Wealth and Your Money or Your Life.

2. Know your number: we found our north star number by multiplying annual expenses by 25. Spend $100k a year? Aim for $2.5 million in net worth. That’s the FI target, allowing us to passively cover your expenses without additional income.

3. Kill high-interest debt: student loan balances at 10% interest are anchors. We paid them off fast—every dollar saved is one we can invest. Without that burden, unexpected expenses like a $10k ER visit won't crush us.

4. Build an emergency fund: We stash 6 months of expenses in a savings account or money market fund. This is our shield against job loss or a busted furnace. I pair it with an additional 2 years of expenses in low-risk assets like Treasury bonds to weather bigger downturns, like a recession.

5. Invest smart: We max out 401ks & HSAs to reduce taxes. We invest any extra savings into low-cost S&P500 index funds or Treasury bonds.. Consistency and time-in-the-market beats any get-rich-quick scheme.

This isn’t easy

It takes sacrifice—fewer lattes, a used car, or a smaller house. But every step builds financial resilience. Imagine a world where a layoff doesn’t keep you up at night, where unexpected expenses don’t mean dipping into your kid's college fund. That’s FI: control over your life.

Look at April 2025 again. Families with no emergency fund got hammered when markets wobbled. Those with a resilient financial plan? They shrugged off the chaos, knowing their emergency fund and Treasuries had their backs. That’s what I want for you—security to weather almost any storm and still be on track to retire early with your kids.

So, what’s your move? Check your expenses, tackle that credit card bill, or start that emergency fund today. You’re not just building wealth, you’re building a life where your family calls the shots. 

What’s holding you back? If you’re aiming for FI, start by getting crystal clear on your 'why'.

This post is part of our 'finding our why' series, sharing real-world stories of why families choose financial independence and early retirement with kids.

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AI epilogue

Grok can help you figure this out for your own situation. Try the prompt below and see where you land.

Prompt:

“Ask me questions to help me determine how much money I need saved, and in what types of accounts (ex. Emergency fund, fixed income, equities), to withstand getting laid off.”