Reader Case Study: A Fresh Start

Today’s case is from a new fellow blogger – Danny aka The Incompetent Investor. After several financial mistakes and big losses, Danny wants to reach Flamingo FI as soon as possible to focus on his health. How soon can he get there?

Note to readers: If you would like your own case study, please get in touch with me! *

Investment losses, chronic pain and lots of loose ends

Meet Danny, a 31-year-old dad of a 7-year-old son who recently moved to Darwin. Danny’s wife Natasha currently lives in Melbourne, which makes the family’s lifestyle and financial situation quite complex. The family has three animals and Danny and Natasha are talking about having a second child soon. They rent and are not planning to buy a home in the future.

Natasha will join Danny in Darwin in a few months’ time, which will make their situation much simpler and bring expenses down. She wants to study nursing in Darwin, but it is not quite clear whether she will choose a part-time or full-time course. Depending on this she will be working either part-time or full-time as well. Natasha also has a side hustle as a dog trainer. The business does not bring in much money at the moment but the couple hopes that there will be more demand for Natasha’s services in Darwin.

Danny’s main motivation for FI is his health. He started his working career in the Army, but unfortunately, he was medically discharged with chronic pain 7 years ago. Danny has been on DVA support on and off ever since. However, he doesn’t want to rely on handouts to put food on the table and it is important to him to earn his own money.

Danny recently graduated from university at the age of 30 with a Bachelors in Arts and got his first professional job outside the army. Because of his chronic pain, he feels quite tired of working already and wants to be able to downshift and focus on his health more as soon as possible. He is also considering going back to uni to study for a Master’s degree – he has an offer from Monash University.

In the past, Danny didn’t have the best financial habits. During his time in the Army, he would spend entire pay packets in a single weekend. He tried to get ahead financially with the help of questionable “investments” that all resulted in significant losses. He lost over $20k in cryptocurrency, $10k+ in speculative stock picking and additional funds by following recommendations from a very expensive stock picking newsletter. In addition, he purchased a brand new car several years ago that is now only worth a small fraction of the purchase price due to hail damage. It doesn’t stop there: Danny sent a significant amount of money overseas to his first love in India and never saw the money again.

Danny is aware of the financial mistakes he has made in the past and has started turning things around for himself. He and his wife have started a portfolio of LICs and ETFs that they contribute around $2,600 to each month. He has recently started his own blog about his FI journey at

Danny came across Money Flamingo on a Reddit thread a few weeks ago. He was glad to find out about Flamingo FI as the approach is more attainable for him and his family than regular FIRE. It suits him better as he doesn’t want to stop working completely, so semi-retirement seems like a great option for him.

Danny is hoping to find out how long it will take him and Natasha to reach Flamingo FI and how they can achieve a better financial position for their family.

The numbers

Let’s have a look at the family’s numbers:

Annual Salary (Danny): $70,000 (gross) = $54,833 (net)
Annual Salary (Natasha): $55,000 (gross) = $45,183 (net)
Total after-tax income per year: $100,016

Annual employer Super contributions:
Danny – $6,650 (gross) = $5,653 net (after Super tax – 15%)
Natasha – $5,225 (gross) = $4,441 net (after Super tax – 15%)
Total after-tax income (incl. Super) per year: $110,110

LICS and ETFs: $64,000
Super: $55,000 (combined)
Cash: $13,000
Total: $132,000

This is where things get difficult. Danny and Natasha don’t track their expenses. Danny pointed out that they are not big spenders, but he does not have a clear picture of their monthly expenses. Their current after-tax income is $8,334 and they invest $2600 per month. So I can only assume that their living expenses are somewhere around $5,734 per month / $68,808 per year.

Of course, these numbers don’t mean much considering their current living situation that will soon change. In 2019, once Danny and Natasha live together in the same place, their living expenses should go down.

When I asked Danny how much he believes he will need as an annual budget once he reaches FIRE, he first estimated the family would need around $70,000 including $20,000 for rent. Later on, he changed his estimate to $50,000-$55,000.


This is an interesting case, isn’t it? Before we dive into the analysis of their situation, I would like to congratulate Danny and Natasha on their efforts! It is not easy to turn things around and make a fresh start. They have a long way to go but they are definitely on the right track!

Now, let’s get to work.

First things first. I strongly recommend that Danny and Natasha start tracking their expenses. This is the only way they can get an accurate picture of their spending and true budget requirements. This will also help them find areas where they could cut back in order to increase their monthly savings amount. And of course, it will also help them when it comes to calculating their likely budget requirements in retirement. Don’t delay, start tracking now!

The next thing I would tackle is their lifestyle and life plan. I know they are in the process of simplifying things with Natasha joining Danny in Darwin, but I think they should not stop there. They seem to be a little “all over the place” at the moment. Danny has an offer to do a Master’s degree at Monash University starting soon (which I assume would be in Melbourne) and Natasha is not sure about whether she wants to study nursing full-time or part-time. They are also considering having another child soon.

It would be a good idea for them to sit down together and come up with a realistic 5-year plan for their family. Where will they live? Will they go to university and in what capacity? How does a second child fit into the picture? FI seems to be an important goal for Danny, so I would keep this in mind when it comes to making decisions. From a financial perspective, it would, of course, make sense for Natasha to study part-time and work full-time, but this is something they have to decide as a family. Does Danny really need to go back to uni to get his Master’s and would this lead to an appropriate payoff salary-wise? Another important aspect they should keep in mind is Danny’s health, which should take priority when it comes to making any major decisions.

With so many unanswered questions it is difficult to give Danny and Natasha a proper plan tailored to their situation. There are too many moving parts. Given that Danny is not sure about their future budget requirements, I will base the calculations below on the ASFA standard which I wrote about a few weeks ago. A “modest lifestyle” for a couple in retirement costs about $40,000, so I think this is a number we can work with. However, this assumes a paid-off house. Since Danny and Natasha are not planning to buy a home, we have to add rent to this number. I think Danny’s $20,000 estimate is accurate enough. This gives us an annual budget target of $60,000.

Given their current situation and Danny’s health issues, I suggest they keep the $13,000 they currently hold in cash as an emergency buffer. I will use their LIC/ETF portfolio as well as their Super as the starting balance for the calculations below.

Danny and Natasha’s path to FIRE

Danny and Natasha want to withdraw $60,000 per year from their portfolio in retirement. According to the 4% rule, their FI number is $1,500,000 ($60,000 x 25). Under the current tax rules, we can assume that the couple would have to pay hardly any taxes on their investment income due to franking credits. If the government really ends up changing the rules around franking credits, the couple’s FIRE number would be a fair bit higher and they might have to revisit the calculations.

A quick note: I hope Danny and Natasha won’t get discouraged when they see the calculations below. They are based on their current income and savings rate. Both of their salaries are well below the national average, so I believe that there is substantial potential for pay increases in the next few years, especially for Natasha once she is a qualified nurse. I also think that once they start tracking their expenses they will find many areas where they could cut their spending, which will increase their monthly savings amount.

Now let’s have a look at their path to FIRE. Note: All the calculations below assume a 7% inflation-adjusted return per annum.

How long will it take them to reach FIRE the traditional way?

16 years! Ouch… As I mentioned above – I am sure that Danny and Natasha will be able to increase their income and save more in the future, but still, they are a long way away from FI.

In this scenario, they would jump from their current income to zero:

Danny and Natasha are lucky though! They both don’t want to “retire” from work completely and want to continue working part-time for many years to come. Natasha is passionate about being a nurse and her side hustle as a dog trainer. And Danny finds working important for his self-esteem. So Flamingo FI should be a great fit for them!

Let’s have a look at their path to FIRE with Flamingo FI:

Just under 10 years until they can semi-retire! I’m sure that is a lot more appealing to them. And again, this is based on their current income. If they can increase their income and the amount they invest every month, they should be able to get there a lot quicker. At the end of the semi-retirement phase, Danny and Natasha’s Flamingo FI nest egg should have grown into his FIRE nest egg. At this point, they can choose to fully retire if they want to (which is unlikely). Note: The $5,491 under “Savings” in the semi-retirement phase are after-tax Super contributions from their part-time jobs.

This is what the couple’s path with Flamingo FI would look like from an income perspective:

And that’s the end of today’s case study. Danny and Natasha have a lot of decisions to make and a fair bit of work to do to reach their goal, but they are on the right track and I am 100% sure that they will get there!

Do you have any tips for Danny and Natasha that could help them achieve his goal sooner?


* Please keep in mind that we are not financial advisors and do not offer financial advice. Anything we write about or recommend on this site should be seen as a suggestion, not advice. If you decide to implement any suggestions we make, you are responsible for this decision and the results. 


Disclaimer: The views expressed on this website are personal opinions only and should not be construed as financial advice for your given situation. While all attempts are made to present accurate information, it may not be appropriate for your specific circumstances and information may become outdated over time.


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8 thoughts on “Reader Case Study: A Fresh Start”

  1. I think Danny and Natasha could make this work, their priority should be to focus on the money accumation for now. Danny should stay in his job and if he can fit it in, study part time, or work on promotions in his current role. Natasha should start working as an un-registered nurse with the ambition to study Part time to get her RN qualifications. If they can then live simpler and have two good salaries they will be then well on track.

    All the best to you both and the family!

  2. Well done for getting started guys! I agree with Mrs F here, you need to make a plan for the next few years and then it’s all about consistency. Not sure going to uni is necessary for Daniel, just focus on making more money. Start tracking and cutting your expenses too, it’s a must! Good luck and I look forward to following your progress! Would be great to see an update to this in 6 months or so Another great case study!

    • G’day Ian,
      Thank you for the kind words. Yes we definitely need to get a plan sorted and start tracking expenses which we have started.
      In regards to the study, the total course is $12,000 for a CSP place for Masters in Social Work. It is relatively cheap for the opportunities that it will provide both for career options and pay increase. I compared this to a Juris Doctor, which is $100,000!!! I felt the CSP Master in Social Work was well worth the investment!
      I am glad I found Mrs F blog also. Awesome concept that deserves way more credit. Only a matter of time I reckon!!
      The Incompetent Investor

  3. G’day Money Flamingo,

    Many thanks for doing a case study for my family! I’ve forwarded it to Tash, and she was quite impressed. She was shocked initially like we were famous for a moment ha ha!

    I would love to keep you posted and as IAIN suggested, perhaps if time permits and depending on your work load, I could provide you with an update to keep your loyal readers informed!

    Thanks again for the suggestions. I am going to give it a good crack!

    Cheers 🙂

  4. Good luck on your journey Danny and Natasha!
    10 years to semi retirement sounds awesome!

    It sounds like there’s room to move on your expenses which could make it happen even faster.


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