The 10 Pillars of Financial Independence – part two

There are 10 key ‘pillars’ to financial independence, says Mouthy blogger Finance Dee. In part two of a two-part blog, she explains the second five.

My previous blog post looked at the first five steps of the 10 Pillars of Financial Independence (FI) which were developed by Brad and Jonathan from ‘ChooseFI’.

In this post, I discuss the remaining five pillars (pillar six – pillar 10) of FI.

6. College (university) hacking

For those of you considering higher education or even masters or doctorates – think about the cost/benefit of what that education costs.

As the ChooseFI guys are American, college-hacking is particularly relevant in context of the US higher-education system. Higher education in the US is fearsomely expensive, but the UK isn’t free either.

In the UK, scholarships aren’t as commonplace as in the US, but there are still merit scholarships available to students. If you’re planning on taking student loans on, find out whether you can get any financial help.

Student loan repayments act like a 9% tax on your income above basic income tax for years after you finish uni. This is a not inconsiderable impediment to your earning potential.

When it comes to studying abroad, the popular Erasmus program was phased out at the end of 2020 due to Brexit. The government has however implemented the Turing Scheme to replace Erasmus, commencing in September 2021.

The Turing scheme will fund British students to live and study in Europe. This is a great way to get education funded while also travelling and experiencing a new country.

7. Travel rewards

Some schools of financial thought believe credit cards should be avoided like the plague. But the FI community advocate for their use when they are used appropriately, such as paying off the card balance in full every month.

Travel reward credit cards can be a great way to not only offer added protection on purchases and holidays booked, but can also result in reduced flights and hotel stays.

Some of the popular travel reward credit cards we have available to us in the UK include the British Airways Platinum American Express card and the Virgin Atlantic Reward+ Mastercard.

8. Cut the cord

In the US, ‘cord cutting’ is a movement that eschews costly cable bills in favour of cheaper services such as Netflix.

While paying a TV licence in the UK is not optional, unless you cut out any BBC programming or live television, there are some similarities we can see in other typical household bills that get out of control.

Phone and broadband bills have a funny way of getting out of hand, and subscriptions to expensive TV services such as Sky or Virgin Media can add up to a lot of money.

Look for new cheaper deals instead, from There are constantly new sim-only phone contracts to new cheaper TV add-ons such as Amazon Prime or Disney+.

Thankfully, there are great comparison websites available to help get the best deals possible, and even cashback websites to get a portion of your money back whenever you switch over to a new deal.

9. Side hustle

As the FIRE movement enables people to retire early, considering a side hustle that you enjoy and are passionate about can be a great way to keep active once you reach FI.

This is particularly important for those who will reach FI in their 30s or 40s as the reality is the novelty of retirement would wear off pretty quickly if you’re not kept active doing things you enjoy.

A side hustle is a great way to dig deeper into one’s passions whilst potentially bringing in an extra source of income that could be used for a bit of extra fun money.

10. Savings rate and the 4% rule

The secret sauce of the FI movement is to understand the 4% rule. In short, when you have enough money saved/invested to live off a 4% return of your investments every year, you are considered financially independent.

If you had an investment pot of £100,000 for example, you would have a yearly investment income of £4,000 (4%) indefinitely without having to worry about running out of money. Now of course, in order to comfortably live off of those investments, you would need an income much higher than £4,000 per year, so a sizeable investment pot would be needed.

Alongside understand the 4% rule, understanding the power of your savings rate is also important to understand. In the FIRE community, people generally tend to save/invest 30% of their income on a monthly basis, but essentially the higher your savings rate, the quicker one can achieve FI.  

Although these pillars do not form the whole picture of FI, they help to give a big-picture view of things that can be done in your life to cut expenses, increase income, optimise investments, and ultimately have more money to grow your financial freedom fund.