Financial Independence My Financial Journey (Retired at 27, Living On $20,000/Year) |
- My Financial Journey (Retired at 27, Living On $20,000/Year)
- Am I FI? #s included
- Daily FI discussion thread - February 27, 2018
- How to not think about FIRE day to day?
- Odds of getting a 403b added to my 457
- How to start from the bottom — literally
- Attracted to FI for the wrong reasons?
- Using a Roth IRA and dividends for FIRE - am I missing anything?
- Maximizing my 401K contributions from commission check?
- Are there any FIRE enthusiasts in Munich?
- Student loan debt in the U.K.
- Suze Orman article in Money
- Moving from LCOL to HCOL + effective paycut
| My Financial Journey (Retired at 27, Living On $20,000/Year) Posted: 27 Feb 2018 02:09 PM PST My Journey: Ages 17-21: Graduated with undergraduate in Business Management and minor in Construction Engineering Management. ($10k in debt) Age 21: Bought my first home and rented out two rooms (Rental Income: $1000/month) Ages 21-26: First job at a startup ($36k salary) and worked my way up to a director position ($60k salary). At first I was working 45-50 hour weeks, but as I grew into management and was able to deliver very high results, I was able to hire my own team and manage my own account(s). For the last 2-3 years at this company I worked 5-10 hours a week. Age 24: Bought second home and rented out a room. Also rented out all of first home (Total rental income ($2500/Month) Age 25: Started renting out homes as short-term rentals (Rental Income: $5k-$10k/month depending on season) Age 26: Obtained MBA. Age 27: Consulting work for fast growth companies working 20 hours a week ($75k annually) Age 27: Monthly expenses were below $1000 a month and income was $10k-$15k/month. Cash/Liquid Investments: $150k Equity: $250k Paycheck: $6k/month Rental Income: $5k-$10k/month Age 28: Decided to quit working and "retire." Started plans on building an income property. The moral of the story is you don't need millions, or even a million dollars, to "retire" early. My philosophy on the whole game is generate and save as much money as possible when you start - buy assets, create new revenue streams, slash expenses as low as you can go and once your monthly passive or secondary incomes are 4-5x higher (you can do 2x as well) than you living expenses, retire. I took it one step further and bought land and built an income property mortgage free. To ensure my living expenses would stay low and my income would be higher. I allowed myself to have two hobbies where I splurged, but other than that I hardly spent any money on entertainment. What do you guys think? Are you doing, or did, something similar? [link] [comments]  |
| Posted: 27 Feb 2018 05:14 AM PST I think I can retire but I'm cautious. Bit leaner than some, but these are my numbers. Age: 51: Monthly income from pension: $1,400 Income from invested money: $1,100 Expenses: $2000
That would seem to leave $500 left over for "whatever" - add to the trip fund or fund for computer upgrade, clothes, etc. My hobbies are going to the library and swimming and the gym, pretty cheap. I don't take a lot of trips, but plan on maybe one a year - flight and hotel for 4-5 days or visiting friends and family. Assets: aforementioned house, $280k TSP, $70k Roth, $21k cash emergency fund. Withdrawal at 4%: $14,000 per year ($1166 monthly) Should I be doing anything else here? Keep investing with anything left over? Take less than 4%? [link] [comments]  |
| Daily FI discussion thread - February 27, 2018 Posted: 27 Feb 2018 03:08 AM PST Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply! Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked. Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts. [link] [comments]  |
| How to not think about FIRE day to day? Posted: 26 Feb 2018 07:20 PM PST I'm recently entering my journey into the FIRE with my wife, who is also on board. I find myself constantly thinking about it and reading/researching/spreadsheeting. We have a plan and a system in place, but it's all I think about and can even be distracting. How do you all handle that? [link] [comments]  |
| Odds of getting a 403b added to my 457 Posted: 27 Feb 2018 01:02 PM PST I'm a government worker and have a 457 that I max out at my work. My city doesn't offer a 403b and I'm wanting to see if I can convince them to add it for that extra $18.5k in tax advantaged accounts. Does anyone know if there is an additional administrative fee that the employer would have to pay to add the 403b option? I'm guessing I'd have to talk to someone in HR or payroll. Has anyone ever had success in causing any change to their retirement plans at work since we tend to know a little more about smart options than the average employee 75 employees made over $100k and 200 were over $80k and there's about 400 full time employees. I've heard that only about 10% max out now though so I'm not sure how many of them would also continue to put more away in a 403b. [link] [comments]  |
| How to start from the bottom — literally Posted: 27 Feb 2018 12:29 AM PST Hey all! Long time lurker of the sub and just want to first say you all are an inspiration to me by reading your posts and giving me the motivation i needed. I tried searching the sub for a post similar to my general question, but couldn't really find an answer so I thought I'd come out of hiding and just ask. 31 year old — curious to any strategies or ways of thinking/approaching FI literally starting from the bottom. I have no retirement fund, pretty much non existent savings, no major assets and close to no CC debt. Now before you judge me first let me say i do work as a freelance designer but as that has been slowing down I am going to be reentering the job market and use my small freelance income as a side hustle. Currently have no rent or major bills as well so everything can be saved. One dilemma I currently have is that I'm living with the inlaws currently as they needed some help so I'm finding myself on an island where there are no agencies in my line of work, so I've been looking at other jobs to at least be doing something in the time I'm here and those jobs around 12/hr. I'm very frugal with my expenses but am just wondering other than saving and tracking expenses if there are any other strategies or things to keep in mind that i can apply now to get the ball rolling till i can move back to the city and get a position that will be around 60-70k a year. Sorry if this is the wrong place to post this but my main goal is to work and strategize to get where you are all are and start forming the habits even when working with a little bit. Thanks again and i wish you all continued success in your journey! [link] [comments]  |
| Attracted to FI for the wrong reasons? Posted: 27 Feb 2018 04:14 PM PST I've been having some inner conflict about this recently. I had kind of a realization that the main reason I have been planning out an FI track the last couple years is because I am too lazy and undisciplined to focus on my profession and career growth, and the associated sacrifices. Not because I want the freedom to pursue other endeavors. I have a pretty great career (aerospace engineer) which is relatively high paying but to be honest I really don't care about it outside of the occasional interesting challenge. I am a good worker but I essentially have no interest in advancing and 'climbing the ladder'. I have an inkling it is for negative reasons, like that I am unconfident in my abilities and the competitiveness, so rather than try to play the game I resign to the fact that I am where I am, but that I can focus on saving (the easier sacrifice to me), and check out entirely 20+ years ahead of everyone else. I really do not relate to my peers' focus and hustling in their careers. Even while finding my work engaging and challenging at the end of the day in the office I'm thinking "what the hell am I doing here". I feel ambivalent about it, like I should be focusing passionately on something rather than just accepting my current trajectory to retirement, but I also don't feel particularly drawn to anything else. Other than just simply not having to go to work. Is this a normal attitude to have? are others simply better at faking it and disciplining themselves to care? I could use some wisdom if this seems relatable. [link] [comments]  |
| Using a Roth IRA and dividends for FIRE - am I missing anything? Posted: 27 Feb 2018 04:11 PM PST Hello all, new to this sub, but I am on board and inspired! I apologize if this topic has come up in the recent past. Here's my question. I am looking for something like a "FIRE kinda slowly after about 15 years" approach and wonder if I am missing anything. The crux of my plan right now involves maxing out my Roth IRA every year in a solid, dividend-paying portfolio of stocks, bonds, and commission-free ETFs, which I've already begun to do. Through compounding interest, if I make the same rate of return as the market for example, I'll set myself up to live off of dividends from positions that have expanded (tax-free all the while) in my portfolio. At some point, likely when my net worth is closer to $250K in about 10-15 years between the IRA and my company 401K, use my net worth to leverage my way into a franchise, or something of the sort, and leave my desk job in favor of being more of an entrepreneur. Also would consider leaving my desk job sooner to go into business for myself, but that is not a given yet. Also would consider being a real estate investor, but the point is, I would do so when my net worth on paper via the IRA allowed me to attain any necessary loans more easily. All the while, whatever I do, I just keep maxing out my Roth IRA every year so that by the time 30-35 years have gone by, I can truly live off of dividends only and not much else. I apologize if any of this plan is not in line with FIRE, but I am basically posting it here asking those with more knowledge than me to poke holes in this plan, as necessary. Thanks! [link] [comments]  |
| Maximizing my 401K contributions from commission check? Posted: 27 Feb 2018 03:24 PM PST Hello everyone! Some background: I am attempting to get FIRE asap with the assistance of this subreddit! I do work a sales job and make about $ 75,000 a year gross and live roughly off of $ 15,000 a year. I have paid off all of my debt and am starting with my 401K I have $ 20,000 in there and am 27 years old. I do work a sales position and usually get three checks a month. One at the beginning of the month for my base pay, the second and third one after for base pay and commission respectively. My checks are usually, gross, about $ 1,400.00 , $ 1,400.00 and $ 5,000.00 . I am hoping to find out if there is any way that you guys know of in which I can have my 401K contribution to come out of my commission check exclusively. I will save a lot in taxes. My HR response was: "The 401k limit for 2018 is $18,500. You can not set your contribution based on earnings type or amount. If you are set to 10% it will apply to your regular as well as your commissions pay. You can change your 401k withholding percentage as often as you like, although the timing will be difficult to predict of when the change will take effect. Hope this clears things up for you." Does anybody have any insight on this or experience? [link] [comments]  |
| Are there any FIRE enthusiasts in Munich? Posted: 27 Feb 2018 11:29 AM PST Im aware of r/munich but I believe the likelihood of having the right minds reading the post is higher in r/financialindependence ;-) Since no friends or acquintances are really into the topic I was wondering if there are any FIRE enthusiasts in Munich who would be interested to meet up for a beer?! [link] [comments]  |
| Posted: 27 Feb 2018 08:50 AM PST Hi guys This is a great sub and I enjoy reading views far and wide about FI I was reading an article today about how one should try to rid themselves of student loan debt as soon as possible in order to achieve FI. I was wondering, is this especially the case for people in the US? Does it matter much for people in the UK? I have around £19k of my student loan to pay back its quite the sum but nothing compared to some Americans (150-200k wtf?!) Every month a small amount (around £50) gets taken from my pay to pay the loan back, of course as salary goes up this will also increase but it will still take a long time to pay off at this rate. You can of course pay more out of your salary so that the debt goes down faster but is it worth it for people in the UK ? Will it have a lasting impact on my ability to become FI ? As ever all insights appreciated! [link] [comments]  |
| Posted: 26 Feb 2018 07:27 PM PST I didn't like that she says 70 is the age one should retire without any consideration to what you have saved as related to your expenses. I think she just wants to be controversial. http://time.com/money/4989314/suze-orman-new-retirement-rule/ [link] [comments]  |
| Moving from LCOL to HCOL + effective paycut Posted: 26 Feb 2018 05:19 PM PST A couple years ago I moved to a LCOL for a job that pays very well. It was a good move, but I did have to leave my friends and the life I had in Boston and I came to a small rural city and I just haven't been able to connect. I'm turning 31 tomorrow and its growing in me that I would just be happier to be back in glorious Boston. There are some good opportunities I'm looking into, but combined my good pay and LCOL, I don't expect to effectively break even. = I would go from paying $300/mo or less in rent (I own a duplex, that's after expenses) to paying about $1000/mo after accounting for managed duplex income. I don't know what I'll get offered, but I would expect its about the same as I get paid now. I'm also trying to pay for online graduate classes and max out my retirement. Has anyone ever done this? Why? Were you glad you did? How did you mitigate the changes in expenses and pay? [link] [comments]  |
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