Cody’s marathon to financial freedom

In 2018, Cody Endres told us he was running a marathon…toward financial freedom. Financial freedom, he said, means you are in control of your finances instead of being controlled by them. And it means that you get to make life decisions without being overly stressed about the financial impact—because you are prepared. Decisions like when to retire.

“If you do it right,” he said, “you can retire well equipped when you are still young enough to enjoy it.”

Unlike many of his contemporaries, Cody—just 27 at the time—was looking down the road at his financial future knowing that making wise decisions now could help him get to the finish line. Thanks to the knowledge and encouragement he received from veteran educators, the financial planning resources at Member Benefits, and an investment of time to increase his financial IQ, he was off to a good start. He took what he learned to heart and began to implement a plan for his financial life by opening a 403(b) retirement account and putting a budget in place to manage spending and reduce debt.

Cody’s financial situation was typical of many younger educators—debt and student loans weighed heavily and added to the challenge of getting ahead. “When you’re on a medium to low income, it’s hard to pay off those debts and still save and have a life,” he said. “It’s important to have a budget, live well within your means, and know where your money is going each month. If it’s going to the right places, it’s easier to pay off those loans and also save for your future.”

Cody was also aggressive in looking for ways to accelerate his plan. “Opportunities to reduce debt and increase savings aren’t always in the form of a pay raise. Any time you’re able to get extra hours at work or summer work, and you realize you have a surplus of money, that’s an opportunity. Recognizing the long-term potential for that money—not using it for a vacation or to buy the newest thing—is a great way to chip away at debt, add to your reserve or emergency fund, or increase retirement savings. Over the course of time, all of those opportunities add up and will help you reach your goal sooner,” he said.

With a goal and a strategy to achieve it in place, Cody committed to paying off student loans, building an emergency fund, and saving for retirement. “I’m on my way. I’m making sure my money is going to the right places and I’m on track. It’s not a sprint. There are many decades to go. But I think the outlook is good.”

Three years later

Well, a lot can happen to a 20-something who has a lot of living to do in just three short years. Cody is no exception.

So where is Cody now in his quest for financial freedom? He agreed to give us an update with the same enthusiasm he had in 2018.

To achieve financial freedom and be in a position to retire at a younger age, you have to do some early planning and save accordingly. When Cody learned the significance of time when it comes to long-term savings, he eagerly made the decision to open a 403(b) account. Cody was off the starting line early compared to the majority in his age group.

Q&A with Cody Endres

When we did your interview for the magazine it was 2018. You were starting your fourth year of teaching at Lodi. Fill us in on your career since then.      

Thankfully, I am still teaching and coaching within the School District of Lodi. I don’t think I would ever teach or coach anywhere else. I continue to teach 3rd-5th grade Special Education and I also continue to coach wrestling.

The pandemic was really hard on teachers, but as we all know, it was hard on everybody. Nobody came out unscathed. Whether you were a teacher, an admin, a school board member, a coach, a parent, or a kid, we all struggled. My concern throughout the entirety of the pandemic was how we as educators could keep the focus on the kids who needed our support the most. We worked tirelessly to accomplish that. It was by no means perfect, but I truly appreciated the work that my co-workers put into the school year to ensure learning, and the relationship building that happened throughout the entire last school year.

Tell me about any changes in your personal life. At 27, there were a whole list of possible life events ahead of you. What’s been happening?

Twenty-seven seems like a lifetime ago! I turned 30. Rachel and I got married in 2019 and we welcomed Evelyn into the world in August of 2021. We also have a cat (that I don’t like) named Gretel.

In 2018, Rachel and I were renting a cheap apartment here in Lodi. We knew we didn’t want to rent forever and we made a concerted effort to search for the right place to purchase when the time (and price) was right. In March of 2020, just as the pandemic was starting, we closed on a triplex in Lodi. We “house hacked” that first property—meaning, you live in one of the units and rent out the others. It was one of the best decisions of our lives.

Soon after, we realized that our tiny one-bedroom unit wasn’t big enough to start a family. So we and purchased a quadplex in April of 2021 that had two-bedroom units spacious enough for our family.

I know you had set a goal to pay off student loans, saving, building an emergency fund, talking to investment professionals, and making sure your money was going to the right places. How are you doing with that?                                                 

On December 30, 2020, I was able to pay off the remaining balance on my student loans. What a gratifying feeling.  It was like a weight was lifted off of my financial shoulders. I had felt like I was drowning in student debt, so to be able to have no debt, aside from the mortgages on our rental properties, was something I didn’t think would be possible five years ago. Like I always try to tell my students and wrestlers, “I’m not promising you it’ll be easy, I’m promising you it’ll be worth it.” All the sacrifices and discipline we put into paying off those student loans were definitely worth it.

The next day we were looking at our next financial goals and objectives. We feel good where we’re at but know that there is always more work to be done. Heading into 2021, we put a higher focus on our monthly budget, tracked our savings rate, and made a focused effort to invest our money instead of just letting it sit in a savings account. We knew that our chances for financial freedom depended on investing our money in different avenues and beating inflation.

How has the saving gone since we last talked? Are you still sticking with your strategy to increase savings when you can? If yes, what opportunities to increase contributions have you utilized? Do you still have aspirations to retire early?

Growing up and throughout my early and mid-20’s I was really big on putting money into a savings account, which is great, but there is a better way. We now focus on investing what we save each month. We’re still young and we know that we can still benefit from decades of compounding interest. Someday, when we have more kids, or a bigger house, or want to save for our children’s future, we may not be able to invest as much as we do now. However, our hope is that at that time we can let the compounding interest from our previous investments do the heavy lifting for us and make significant gains.

We’ve also recently opened a taxable brokerage account and we call it our “Freedom Fund.” This is a short-term savings account that we can make withdrawals on at any time. It doesn’t have all of the tax benefits as other retirement or investment accounts, but being able to access it is a huge benefit and provides for more financial flexibility.

You mentioned a veteran teacher who you considered your financial mentor. Do you stay in touch with that teacher? How have you paid that advice forward with your colleagues or by mentoring new educators?

I have been fortunate to have a lot of financial mentors—teachers, family, friends. I do stay in touch with the teacher who first educated me on the benefits that educators have. He continues to be a vital person in my teaching career. He’s educated me on more than just finances, he’s made me a better teacher.

I try to pay forward the knowledge he gave to me. As teachers we’re inundated with so many things all the time. We rarely stop and think about our needs, what’s best for us in the present, and what’s best for us in the future. I think that needs to change. There needs to be more conversations about finances. The need goes beyond young teachers. We need to be teaching EVERY high school kid in this state basic financial principles. Finances are too important to leave to chance.

Another thing—and I am really proud of this—is the coaching team of which I am a part of coaches the students on more than wrestling moves and match-winning strategies. We talk about life issues, too. Especially with outgoing seniors. We talk about finances, college, scholarships, career options, or anything else to help them transition beyond high school.

In the past, you took advantage of educational opportunities to learn as much as you could about finances. What are you doing now to continue learning and increasing your knowledge?

I seek out people who are smarter and more successful than me and follow what they do. Everybody’s situation is unique and different, but you can learn something beneficial from everybody. I also continue to spend time doing research to build my knowledge. That’s how I learned about taxable brokerage accounts. I had no idea what it was or that it was an option until I did the research.

It’s the same thing with real estate. We didn’t know a lot about it at the start, but we knew a lot of successful people made their wealth through real estate. It wasn’t easy to get started, but nothing worth having comes easy. We continued to learn, make connections, fail, try again, fail, and eventually hit on the right opportunity.

What’s been your greatest financial challenge over the last three years?                          

One of the biggest challenges I have faced since I started teaching is the number of hours I’ve had to work to get to this point financially. I love education, but a young teacher’s salary alone will not help you create wealth. I had to do as many side jobs or activities as I could to supplement my income—like working most Saturdays when not in wrestling season. While others took spring break, I would put in an 80-hour week putting in docks. During the summer, I was working 60 hours a week when I could.

But now that I have a wife and daughter, I don’t want to put that same amount of time into working other jobs. I want to spend that time with them. My hope is that our rental properties will provide additional money to supplement our income—enough that I have more time at home.

Making money is great, but it is secondary to time with family.

What has been the most important financial decision you have made over the last three years?

I would say either paying off my student loans and becoming debt free or purchasing rental properties. They’ve both been so immensely beneficial that I couldn’t just pick one. It’s like asking a parent to name their favorite kid, I just can’t!

Finances between spouses can often be a struggle. And it’s not uncommon for one spouse (historically the husband) to take charge. How do you and Rachel share the responsibilities?                                               

When I was in college, and especially once I got out, I was tens of thousands of dollars in debt with less than a few hundred bucks in my bank account. I was completely broke. At that point in time, I had to take finances seriously to ever dig myself out of that hole and to get ahead. Initially in my relationship with Rachel, I did all of the “money stuff.” However, she has become so engaged and interested in our financial life and future. She now helps me look over budgets, helps track our net worth, looks at properties with me, helps with rental turnovers and tasks, and even questions some of the spending I do! I absolutely love it. We have so much trust and honesty with our finances and it carries over into other parts of our relationship as well.

Have you expanded your savings beyond the 403b to other types of accounts?

As mentioned earlier, we heavily invest in a taxable brokerage account which we plan to use to fund future real estate deals. After the birth of Evelyn, we’ve been focusing on what type of investment account we want to get started for her and her future. There are a number of options available and we are doing the research and asking questions so we can make an informed decision.

What’s the future look like for you? What goals do you have for the next five years?

For the next five years, we plan to stay the course. We know kids will bring our expenses higher so we’re preparing for that.

I love teaching, but the pandemic and some other things in public schools have me questioning whether I can do it for the next 30 years. I hope to teach my entire lifetime, but I also need the option to walk away if it’s best for me and my family. Being able to say “I GET to go to work today” versus, “I HAVE to go to work today” makes me a better teacher—the kids deserve our best each and every day. When I can’t say that anymore, it will be time to re-evaluate.

Ultimately, we want to be able to build enough wealth so we can give back to those most in need. We hope to be in a position later in life to make real change in the lives of other people through financial donations.

You gave some sound advice the last time we chatted: One, as soon as you get in there, start saving. And two, pay down your debt. What additional advice do you have for fellow educators or young aspiring educators?          

Frugality is the first step to financial freedom. Live well within your means. Create a budget and stick to it. You’ll soon realize how much “wasteful spending” you’re indulging in and how much leftover money you have to invest in your financial future.