20 Oct Pursuing FIRE with Geoarbitrage and Side Hustles
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Welcome to the Side Hustle Success Series where we chat with real people about real side hustles! Today, we learn how to pursue FIRE through Geoarbitrage and side hustling. We invited Naseema from Financially Intentional onto the series who recently paid off $1,000,000 in debt.
I first met Naseema in Oakland, California at a side hustle meetup. She was full of energy and passion. I could tell she was FIRE’d up. As she was leaving the event, she casually mentioned that she recently paid off $1,000,000 in debt! She writes about her experiences with money over at Financially Intentional.
The personal finance world is quite small. Let me tell you why.
This side hustle meetup was back in June, and while Nassema’s story resonated with me, we hadn’t reconnected since. Recently, Millennial Money posted a query on HARO (Help A Reporter Out) in search of those using Geoarbitrage as a strategy to minimize expenses and minimize taxes.
The first response back was from Naseema! Rather than feature her story solely on geoarbitrage, we invited her to also talk about her side hustle success!
Because, you know, Naseema paid off $1,000,000 in debt in less than 2.5 years!
Geoarbitrage, FIRE, and Side Hustling
This Side Hustle Success Story takes the form of an interview. The following are our questions and Naseema’s answers. Trust me, you’re going to be energized after hearing what she has to say. Anyone who can pay off $1,000,000 in debt in less than 2.5 years is an inspiration.
Please introduce yourself
By matter of introduction, I’m Naseema McElroy a 37-year-old mom and Labor and Delivery Nurse. I’ve been a certified obstetric nurse for over nine years and love supporting families bring life into the world.
Tell us about your day job
People think that Labor and Delivery is the happy place in the hospital. My daughter thinks I play with babies all day.
While most of the time we do specialize in ‘birthday celebrations’, things are not always so jovial. Often times, we are fighting to keep moms and babies alive, which means making critical decisions where every minute counts.
At times, we have moms who stay in our unit for weeks or even months. We fight to keep her healthy while allowing time for babies to continue to grow in utero. For the babies that don’t make the transition into this world, we support the families through acceptance, grieving, and healing.
90% of the time I’m on my feet managing pain, hydration, supporting doctors through various surgeries and of course catching babies. In the land of L&D (labor and delivery), the nurses run the show. We manage deliveries and call the doctors to come only as the babies make their final descent or when we need to go back for a surgery. As a charge nurse, I’m also responsible for managing the daily operations for the unit and have to ensure staffing is adequate to provide safe patient ratios.
How many days a week to do work?
Before I moved I was working two 12 hour shifts a week at my current job. I also had a part-time benefited job where I was working three eight hour shifts, for a total of 5 days a week. Now I only work five to six days a month.
Where is your tax home?:
As of late June 2018, I am a resident of Reno, NV and this is my tax home. Nevada is a no income tax state. Besides that, the cost of living is incredibly low.
My boyfriend had the opportunity to take a position working with the Washoe County School board to turn around the lower performing schools. He would maintain his same salary as he was making as Head of School at a Charter School in Oakland. Effectively higher with no state taxes.
I had a choice to work as a nurse in Reno, but at a third of my current salary, so I didn’t even bother applying for jobs.
What is Geoarbitrage?
The Bay Area is expensive. Reno, Nevada, by comparison, is not. Geoarbitrage is when one takes advantage of the cost of living differences. Tim Ferriss popularized the concept of Geoarbitrage in his book, “The 4-Hour Workweek”. Geoarbitrage can be used as a powerful tool during one’s wealth-building years. Furthermore, it can help make money go further in retirement.
Are you A Travel Nurse?
While I do travel in from another state, I am not what you consider a “travel nurse”. I have been an employee of a hospital located in Fremont, CA since 2011. I am a per diem nurse. That means I trade health benefits and a pension for a higher hourly salary. I do have access to contribute to our 403b plan, but I don’t have employer matching or access to the 457 (deferred compensation plan) that is covered in the FIRE community as an early retirement tool.
How much money can you make as a nurse?
Staff nurses in the Bay Area working full time can easily make in the high $100ks to mid $200k. Working my two jobs I have grossed in the mid 200k range for the last five years. This year, as I just moved mid-year, I have already made over $150k. One of the reasons why I moved to Nevada while maintaining my nurse salary in the Bay Area is because the cost of living is much lower.
Give us a sense of the cost of living in Reno compared with where you work
Before I moved, I was renting a 1,000 sq ft 2-bedroom apartment in Downtown Oakland, paying $3600/month. I now own a 3-bedroom house in a gated golf course community for $2,800 including HOAs. This includes access to fitness facilities, pools and up to four hours of free child-care daily. My overall living expenses have decreased by more than half as I don’t have to pay for a nanny and things like groceries and utilities cost less overall.
Where did you learn about this concept of geoarbitrage?
Geoarbitrage is a well-known tenant in the FIRE community. After paying off my debt last year. I discovered the FIRE movement listening to the Journey to Launch Podcast where host Jamila Souffrant interviewed Brad and Jonathan of ChooseFI.
Share with us your financial win
My daughter turned one in 2015. I was tired of living paycheck to paycheck, so I set out on a mission to take control of my finances. Over the course of 2.5 years, I was able to pay off nearly a million dollars in debt.
How the heck did you do pay off $1,000,000 in debt?
Real Estate helped a ton. I started off by selling a condo I had in Inglewood, CA since 2014. The yielded $100k to pay off a car, a 403b loan, and some smaller debts. At that time I didn’t consider my $200k in student loans as debt. I shortly discovered Dave Ramsey and started following his baby steps. More specifically, the debt snowball and zero-based budgeting to attack my debt. I rented out rooms to help with housing costs as well.
At the end of my journey, and after accumulating an additional $30k IRS debt and a $10k a divorce settlement, I decided to sell my primary residence. At this point, I had already paid off $324k in debt and had $50k remaining (not including $576k a home). I sold my home to be completely debt free.
You can learn more about my debt payoff journey here.
Tell us more about your side hustle?
My side hustle and my main passion is my blog, Financially Intentional. I started this journey back in 2016 as a way to track my debt payoff progress and share my lessons learned with my friends. Since then, it has turned into a platform where I share personal finance advice to thousands daily.
I also have a group coaching program called Intentional Finance 101 where I teach budgeting, debt elimination strategies, the importance of investing, estate planning and the path to financial independence.
I am planning on launching a podcast before year-end that will highlight the financial struggles of typical American families, bringing on financial experts to help them to transition to being more intentional with their finances.
What are your financial goals now that you paid off $1 million dollars?
I like to think that I am semi-retired and am focusing on living my best life and enjoying time with family. I’m expecting a baby girl in January and am patiently awaiting her arrival and all the fun having a new baby in the home brings. I am focused on keeping my savings rate high and I want to pay off my current home in three years or less. I also want to expand Financially Intentional into an international brand and help as many people as possible turn their finances around. Furthermore, I am in pursuit of FIRE (Financial Independence, Retire Early), through geoarbitrage and side hustling.
What does financial independence mean to you?
Financial independence is about more than dollars in the bank. It’s about having control over your life to not have to be in abusive relationships or work in toxic environments. It’s about being able to pick up and move if you have to. It’s about taking time to enjoy your kids while they’re still young and you have the energy. It’s about you living your best life now and replacing the “have to dos” with the “gets to-dos.”
Thank You, Naseema!
What an inspiring interview! Naseema took control of her life by taking the reigns of her finances. She was able to pay off her massive debt through real estate investing, and house hacking. While maintaining her elevated job and salary in the Bay Area, and living in Nevada, she is using geoarbitrage to save even more money.
If you are currently living in an expensive city, and struggling to enter the real estate game because the asking price is too high, check out these real estate investing crowdfunding sites. You can invest in real estate with only $500!
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