Financial Independence "This Is What Life Without Retirement Savings Looks Like" (The Atlantic) |
- "This Is What Life Without Retirement Savings Looks Like" (The Atlantic)
- This sub gave me opportunity, and Iam so thankful.
- Budgeting your time like you do money
- Why everyone is using Roth IRA vs Traditional IRA?
- Daily FI discussion thread - February 23, 2018
- Weekly FI Frugal Friday thread - February 23, 2018
- I don't have kids (they scare me honestly) but my partner really wants them. How do you ensure you are financially healthy to have them? What percentage of your income do you allocate for child-related expenses? At what age did you have yours? Any advice you have so they don't break the bank?
- "True" cost of home ownership / REI
- Working your butt off and retiring early vs working less and for longer
- What is a good way to handle allegations of "being cheap" by friends and family?
- FI/RE health check and retirement savings questions
- Best way to invest money for my child?
- Best options for when your job doesn't have a 401k or any sort of long-term savings plans?
- Is it possible to be FI straight from benefits?
- How does health care/insurance work if you retire abroad?
- HSA worth it if you expat abroad?
| "This Is What Life Without Retirement Savings Looks Like" (The Atlantic) Posted: 23 Feb 2018 08:06 AM PST Read this article about seniors who have no money. Even if I never achieve RE (not sure what my life path is going to be), I will never consider my efforts to save money as a young person to be wasted. https://www.theatlantic.com/business/archive/2018/02/pensions-safety-net-california/553970/
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| This sub gave me opportunity, and Iam so thankful. Posted: 23 Feb 2018 09:44 AM PST Hi guys, 21 yo/M/dropped out After I dropped out of college here in my country (eastern europe, after first yeah), I went doing sales. It was funny because when I arrived first time in my job I discovered FI sub and I was astonished. I saw that in my sales job (telecomunication) everyone was buying new cars, going to eat for 20 euro per food etc., just living paycheck to paycheck. In half a year I became top 10 in whole country, improving myself everyday. Average income in my country, 600-750 eur (FI is unreal for most people) I went living with 5 roomates and my expenses were about 250 eur per month.( I was just patience) I could go with my income to 1200-1800 eur every month (when I told customer how much Iam making she was astonished and couldnt believe me) it was base pay(430 eur) + what I sell. And now the beautiful catch. It is such a soul crushing job, the managers trying to manipulate, higher managers are putting down our wages up to 15-25%. And I was laughing. I came to my boss about getting more money every month, with statistics how I made so much money to the company, and he told me that we can go only up with 25 euro per month....yeah. And the beauty of it, In this moment I have around 15k of money(year and half of work), It can last me for 4 years of emergency fund and going to risk it for being an entrepreneur. I decide that this is enough because it gives me aircover to risk a lot. I know my english isnt that good, but I just want to thank you all. Because if I wouldnt find this sub, I would be comparing myself to jonasses(or how they are called :D) [link] [comments]  |
| Budgeting your time like you do money Posted: 23 Feb 2018 10:09 AM PST Not having enough time to pursue your ideal activities is one of the main reasons so many of us are here. I know most of you have a budget, and are really good at sticking to it. Do any of you take your budgeting skills and apply them to budgeting your time as a way to "build the life you want"? I realized managing your time is the ultimate zero-based budgeting example. You really do have to borrow time from other categories if you overspend in one area. (I know this is pretty obvious, but actually going through this exercise was very revealing to me). Here's an approximation of mine: 168 hours in a week.
Doing this made me realize less than 20% of my time is available for me to choose how to spend it. This is a huge factor in motivating me to pursue FIRE. I try to combine categories to save time. A ton of the hours allocated to social can be combined with exercise, and eating. Reading can be combined with exercise, eating, and commute (hello audiobooks!). I need to eat faster and be more efficient when driving places. I value my relationships, but most of my social category is spent with my SO, and I'd like to make more time for my friendships. How do you budget your time? How does your current schedule compare with your ideal (i.e. when you're FIRE?) [link] [comments]  |
| Why everyone is using Roth IRA vs Traditional IRA? Posted: 23 Feb 2018 10:42 AM PST I've been lurking on this subreddit for quite some time and finally opened my account on Vanguard, making 5,5K contribution to Traditional IRA + some regular investments right before market drop (couple of weeks out, my luck, obviously :) ) ... The question is I've seen almost everyone here goes for Roth IRA instead of Traditional. I've gone traditional since I've read few things about it's being better:
So why is everyone using Roth? Am I missing something here? Thanks. [link] [comments]  |
| Daily FI discussion thread - February 23, 2018 Posted: 23 Feb 2018 03:09 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]  |
| Weekly FI Frugal Friday thread - February 23, 2018 Posted: 23 Feb 2018 03:09 AM PST Please use this thread to discuss how amazingly cheap you are. How do you keep your costs low? How do become frugal without taking it to the extremes of frupidity? What costs have you realized could be cut from your life without pain? Use this weekly post to discuss Frugality in general. While the Rules for posting questions on the basics of personal finance/investing topics are more relaxed here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply! 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]  |
| Posted: 23 Feb 2018 02:24 PM PST I see a lot of my friends struggling financially because they are parents and have to spend so much money with their children. Do you have children? Do you plan on having them? What is your strategy? Any advice related to kids + FI is welcome. [link] [comments]  |
| "True" cost of home ownership / REI Posted: 23 Feb 2018 03:03 PM PST https://www.gocurrycracker.com/how-i-made-102k-in-real-estate/ The link above is similar to a lot of other articles I've read about the "true" cost of home ownership. It takes a somewhat overly cynical look at the expenses that most people don't take into account when they gloat over their profits after selling a home. I thought it was particularly interesting comparing the return on an S&P index fund over the same time period. Im hoping to buy a duplex and live in one half in the near future, but after looking at it from that perspective it seems like not as great of an investment as I thought it would be. So I'm curious, with this being one of the most level-headed investment groups I've found, what is this subs general opinion of REI/home ownership? I think it's definitely over-hyped, but do any of you think rental properties are a wise investment opportunity? [link] [comments]  |
| Working your butt off and retiring early vs working less and for longer Posted: 23 Feb 2018 11:09 AM PST Just trying to gain an understanding of everyone's mindset here. I think it's safe to say people in search of FIRE value time more than money, right? Like the ultimate goal is to not have to worry about sustaining yourself, just live simply and have time to do the stuff you actually want to do? So why then, do you go to the other extreme, spending as little money as possible and working as much as possible during your 20s and 30s, the healthiest years of your life with the most potential freedom? I am aware that many of you feel that you are not compromising the quality of your lives, and if you truly believe that, more power to you. But working even 8 hours a day, 40 hours a week eats up a ton of time. It is very likely that, on top of other commitments/chores, you have less than 10 hours a week to yourself. This is a lot of time to work for people that are so averse to working, they make significant cuts to their life for 2 decades just to get out of it. It seems counterproductive. I have been living the other option for a year now: work part time to make just what you need with maybe a little extra. You need to be frugal to be able to live on a modest budget, which all of you currently do anyway (and will be required to do once you reach FIRE and are living on a fixed income). The difference is, I work 4 to 6 hours a day with a negligible commute, while all of you are working 8 to 12. I have time to pursue hobbies and live a life of leisure most of the time. I have time to go to the gym multiple times a week and cook healthy meals at home every day, meaning I am healthier and should live longer. I am less stressed. Turns out, even doing a job you dislike is easy and really not that bad if you're only doing it for 20 hours a week. Believe it or not, I went from despising working and wanting to get out by any means necessary (hence finding this sub) to not really minding it and willing to work longer. I really don't think I would mind working until 65 with this lifestyle. Before you say anything, yes my retirement savings will be relatively meager compared to yours. I will likely continue working past retirement age, and maybe pick up a couple enjoyable side hustles to supplement my income. This combined with government support and my partner doing the same, and I should be fine. This is also realistic in the fact that I plan to live a healthy, relatively stress-free life until then and should be healthy enough to work. I will not be a frail old man who has destroyed his body with stress, fast food, and overwork for 40 years. tl;dr If free time and enjoying life is what you are after, it is the same net result if you sacrifice two decades working hard vs a lifetime of working easy. Discuss. Try not to be defensive, I am not attacking your lifestyle choices. [link] [comments]  |
| What is a good way to handle allegations of "being cheap" by friends and family? Posted: 22 Feb 2018 06:22 PM PST I suppose it wouldn't kill me to go to a slightly more expensive restaurant, but financial and budgetary prudence is a skill that takes effort. In the times I've been a bit loose with a couple extra dollars on a meal, I tended to start spending more on much more expensive things as well. Others who are loose with their money see it as "only a couple bucks, what's the big deal?" They don't empathize with the mindset. And because there's more of them we usually go somewhere mid range or worse. Just curious if anyone else deals with this, and what have you done to strike a better compromise in terms of where to go or what to do. I think restaraunts are probably the main battleground for differing spending standards. [link] [comments]  |
| FI/RE health check and retirement savings questions Posted: 23 Feb 2018 12:48 PM PST Hello all,
I wanted to get a feel for where I stand overall from a FIRE perspective and also ask more pointed questions on savings and retirement accounts.
First, the health check. Below is a quick snapshot of my financial situation:
Unmarried, Male, 31, No Debt other than Mortgage • Salary: ~$110,000, does not include bonus of ~6% of salary – Total ~ 117K • Additional Compensation: I receive %16-20 of salary in profit sharing deposited into 401k every year. Company 401k has a Roth Option and allows for After Tax distributions to Roth IRA. I currently contribute 17% to 401k Pre Tax and 7% After Tax for distributions to my Roth IRA. I do not currently take advantage of the 401k Roth. In addition, I max my personal Roth IRA (5,500) and started taking the after tax distros from my 401k last year (I believe I've seen this called the "mega back door"?). Is that term accurate?
Assets (~$790k) • Cash – ~$33,100 (24.3K Emergency fund, 8.8k Checking) • Investments - ~$386,600 (324.8k 401k, 22.8k Individual brokerage, 36.2k Roth IRA, 2.8k Individual brokerage) • Motorcycle – 1.5k • Cryptocurrency – 2K • Gold – 2.5k • US Treasuries (from when I was a kid) – 5.3k • Car – 8.5k • House – 350k
Liabilities (207k) • Mortgage – ~$206,100 • Credit Card Debt – ~1.5-2k Monthly (paid in full each month)
Net worth (583K)
I maintain a budget each month and generally have a surplus of ~$500 which I move over to my brokerage account to invest (more recently I've dabbled a little in Crypto). Also, for the last 5 years the surplus from each promotion/raise I've received has been allocated to up the contributions made to my 401k (most recently to the After-tax bucket for Roth distros). Essentially, I've been living on the same "take home" pay for 5 years. Here are my questions:
Thanks in advance for all the advice / help! [link] [comments]  |
| Best way to invest money for my child? Posted: 23 Feb 2018 01:04 PM PST Hi, I need some advice putting money in my child's name. I had a child in 2017, and my in-laws wanted to buy him a gold ring thinking that a gold ring should hold value over time, and my kid should be able to sell it in time. I talked them out of it, and instead, they will send us some money that we can put into some investment for him to use later. (in the tune of ~$10,000 I believe) At first, I thought we should start a 529 and put the money into 529 plan, but we live in Texas, and we have no tax benefit doing this. We also think we should be FI/RE when my child enters college, so I'm not sure if the tax benefit is there, there is a risk of penalty if my child decides not to pursue college degree. My second thought was to open a vanguard account on my child's name (if this is even possible). This seems like not a good idea for financial aid qualification if my child were to go to college. (and may complicate taxes later due to child having high unearned income?) What do you guys suggest? My in-laws are out of country, so they cannot hold 529 on their name, and they are not investment-savvy, so I do not want them to hold anything on their name & designate beneficiary as my kid. We could hold the money under my name or my spouse's name (in a new/separate account), we want to make it clear to my kid that this money was coming from his grandparents when we tell him about the money. We are on pace to be FIRE in about 10-15 years, and I was initially planning to provide full tuition for my kid if he decides to go to college. Thanks in advance, [link] [comments]  |
| Best options for when your job doesn't have a 401k or any sort of long-term savings plans? Posted: 23 Feb 2018 03:41 PM PST I max out my Roth each year, I need to get an HSA. Should I be looking for another job over this? [link] [comments]  |
| Is it possible to be FI straight from benefits? Posted: 23 Feb 2018 03:36 PM PST Sorry if this question has been asked before. My fiance and I are both disabled, thus massively underemployed/unemployed and on different benefits (I'm with WINZ, he's with ACC). Literally everything we have we got through handouts. Our situation: I'm 28. I volunteer at op shops. I couldn't even tell you what a paycheck looks like. As far as I know, they are the same thing as Santa. I've lost count of the misdiagnosis that have been slapped on me but the main ones are ASD and arthritis, which is a year-old diagnosis of something that's been untreated for years. And Asthma which is in remission. I just spent a year flinging CVs everywhere, even purposefully chucking my CV at jobs I can't even physically do due to my health problems. But I am abandoning the search this year as it's wasting time for the career I actually WANT to do. I also can't commit to anything more than 6 or 7 months as I am moving in with him in September. And we're also planning a wedding for some reason lol. This year I am focusing on how I am going to start my creative career (art/writing) possibly supported by work-from-home. I have disovered that I am MASSIVLY more efficiant at home, probably because I'm not hemoraging all my energy staying upright for hours or just getting home. I love the idea of multiple streams of income, I don't know how else to have a living wage. I'm renting in the cheapest house my folks could afford (desperation buy as I was a week away from homlessess). It is completly inexesable for disabilities and the backyard is a deathtrap. So in some ways that is good and bad for my FI and my health. My life has been stagnant for at least 7 years as I scrambled for a foot in the door to paid work. So far all that's been offered to me is volenteering, standing around all day with arthritis, for free. 'For the experience'. Still haven't figured out how this 'experience' will put food on my table, but I'm constantly being told it magically will. I have a second hand car I bought from a family member but no licence to drive it by myself yet. I do have a 'savings' separate from my actual savings account. It is an inheritance that I use as an emergency fund but I don't have access to it myself. He is 30, has CP from a brain injury, working three jobs, only one job actually pays him and it's the equivalent of 'half a job' in his words. And the one that pays him is the one he despises, he loves everything else. He delivers papers and is probably being paid the same rate as a teenager, when he has a morgage to pay, a future wife and two cats to feed. Since he has a morgage, he obviously owns his own house. And since we're both disabled of course, he got it through a handout (What? You think a disabled millenial doing paper deliveries could afford a house on their own at 30? LOL!!!!!) His dream is to do paid retail permenantly so he can completly dump the delivery job. We haven't discussed any other plans yet. He has no drivers licence at all so there will probably be one car between us. I do hope he finds something else, mostly for his happyness. But so far we have learned that he IS hireable, but no-one will pay him. I will be moving in with him in September. At the moment, if he wants to come and see me, its a three hour walk (he knows this from experience) I've been known to skip meals when both check and savings were overdrawn. The opshop staff discount is pretty much the only reason I have clothes at all. This year I have stopped buying anything that isn't related to food, rent, power, the occasional art supply and the occasional item for the wedding/marriage (when people let me pay for it). I've pretty much given up on buying clothes. I re-use everything to death. I will even horde my recycling for months just in case I need it. That's why I nearly shit my pants when reading all the suggestions in the FAQ for self sufficiency. You mean people can actually CHOOSE to live like this??? I've been like this for years, I didn't know there was any other way of living. I don't know yet if I will be able to keep my benefit after we are married. Our financial situation will massivly change after marriage. No idea if it will be better or worse yet. Though I have learned that I could be paid to be his permenant live-in carer. I also have to be careful not to earn TOO much. If my regular income reaches a particular amount, my benifits will start getting cut. I have friends who can't work fulltime if they do: bye benifit. And they will be working full-time, earning less than they would if they were unemployed, playing Minecraft and watching Netflix all day. So I may have to carefully plan how much I earn and even hold back from earning a certain amount of income until it is finacially wize to do so. So that was my life situation. Sorry if it was too long and boring. My current plan is that I have started buying small canvases to sell with small crafts and the money will be used to buy bigger art supplys to work on real art. The art career is going to support itself. No idea when its income will buy me more than just art supplys. I'm learning how to do marketing on social media. I have seen local artists selling prints, cards, bookmarks ect. So I have a lot of ideas for product. That's my best planning at the moment. I have to take one step at a time. But I've learned that the dole can't be gradually baby steped out of, it needs to be JUMPED out of. I'm doing this solo. Are there any fellow artists here that can tell me good ideas that started their career/buisness? Any marketing tips? My goal is to follow my calling and maybe earn a living from it, possibly enough to live without the dole. I've wasted 7 years being stagnant and I don't want to waste anymore. Getting interested in starting a busness and being FI was a desperate strawgrasp to climb out of stagnation. My only other options are financially and intellectually retarded. If I get any income outside the dole I want to start paying off my student loans (when the money isn't going straight back into art or straight into my mouth) then possibly help him pay off the morgage. I think my loans automaticly start being paid off once I am employed and paid. Is it a good idea to let loans get paid off or go in and pay the whole thing off (or parts of it) to get it out of the way? Does it depend on the situation? I don't have any numbers when it comes to financial planning. I don't even know how much I 'earn' in a year, let alone how much he earns. I don't consider benefits as FI. The government gives you enough to eat and pay rent. What's independence? I have actually considered prostitution and earning money illegally many times. At this point I don't care as long as I am earning my own REAL money. I'm doing this because my man and I are both capable of doing more than nothing. I wrote a novel and he ran the New York Marathon with CP. So clearly we're not vegitables so we don't see why we shouldn't do more than what we are doing now. So I want to see if it's possible to be FI straight from the dole, or is it a better idea to enter it from somewhere else? Do I need Rat Race work as a base? Or can I start with work-from-home stuff? [link] [comments]  |
| How does health care/insurance work if you retire abroad? Posted: 22 Feb 2018 05:40 PM PST My guess is that you would have to sign up for an expat health insurance company, but the monthly premiums (especially if you are elderly) is ridiculous. (Based on a calculator from a specific health insurance company) for someone who is 60+ years old, the monthly premiums exceed $1000/month if you live in the UK. Is this normal? Are premiums really that high for seniors if you aren't on a national healthcare system? Edit: I mean let's say you are perpetually traveling so you aren't in any national healthcare system. [link] [comments]  |
| HSA worth it if you expat abroad? Posted: 22 Feb 2018 06:29 PM PST I'm in my 20s and started a new job in California and my employer is offering an HSA and FSA. However, according to some FIRE calculators online, I have enough in savings and live frugally enough to be FIRE in a few years. I've read about the benefits of HSA and how its better than IRAs. However, I'd say there's a good chance I will want to live abroad permanently starting within the next several years. If so, I'd say there's a good chance I'll get into something like international school teaching, so I'll still probably return to California nearly every year to spend about a month during school vacation For someone like me who plans to eventually move abroad, is the HSA still worth it? How would it work? I just contribute my part of my salary to it now while I work for my current employer, then if I quit in the next year or 2, I can still let it grow and withdraw money from it to use it for healthcare expenses abroad? But I read somewhere that you need to have at least $5000 in your HSA to avoid paying fees. If I only stay with my current employer for 1-2 years before I expat, won't that be too short to accumulate $5k in the HSA? What about the FSA? [link] [comments]  |
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