Financial Independence Big ticket items vs nickel and diming |
- Big ticket items vs nickel and diming
- Follow-up : Quitting on Friday
- Thought of the day: On making decisions that just save a few bucks here or there.
- Daily FI discussion thread - May 03, 2018
- How to quit with class
- New here! Making radical changes. Please tell me I'm not crazy!
- Unexpected side-effect of savings: desire inflation
- What to do with lots of extra money
- Talk me out of living in an RV trailer
- Can we RE now? I'm lost as to what to do next.
- 21 year old. Need advice about FIRE in Indian context.
- 17 year old wondering about FI
- To FIRE or not to FIRE
| Big ticket items vs nickel and diming Posted: 03 May 2018 04:30 AM PDT The recent post about having to skip eating avocado toast for 67 years to save the equivalent of a house down payment got me thinking about big budget items vs small budget items in regards to financial independence. For example, the local FI group I'm a part of is always talking about going to a different grocery store to save a dime on bananas or go to a gas station on the other side of town to save a nickel on gas. But I keep thinking about how I switched insurance providers last year to save $800 a year on home/auto insurance. It would take 50 years of saving a nickel on gas to make up for the $800 saved on insurance this year. Rather than nickel and diming for the rest of our lives, is there a handful of big items that can save a few thousand dollars a year to help expedite FI? [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| Follow-up : Quitting on Friday Posted: 03 May 2018 11:29 AM PDT Here's a follow-up to my post from Monday. I was planning on having this conversation with my boss on Friday but I had to move it up to today! The reason is that we were going to have a meeting this morning to discuss the re-org (yes...we love re-orgs) of our department. This is the second re-org in less than six months, and the first one did not go smoothly for many reasons, but mainly because they shuffled people around without addressing the underlying process issues. I knew we would likely discuss the my role and that of my team in the new organization. I felt like I had to let him know that I was leaving so he could factor that into the re-org plans. I'd feel guilty if he started assigning new people to me only to have me tell him tomorrow that I'm quitting. As soon as our call started (it was just the two of us) I immediately told him that I was leaving at the end of this month. He was totally shocked. I hadn't given indications before that I was going to do this and even though we've had significant turnover in my area I think he thought I was "safe" from leaving because I've been with the company for 20 years. I told him how I was ready for a change in my career - and it wasn't just having a new title, higher salary or different job responsibilities. I explained how I almost quit last year after an especially stressful project completed but I didn't want to let my career end on a note of burnout. In the end he was very understanding and supportive. He went through a similar situation earlier in his career where he said he took several months off between jobs and he really enjoyed the break. I didn't go into details around my FI achievement but I did say that I had plenty of financial cushion to support me if I try new things like dabbling in some freelancing or consulting work. I also was clear that there was not any one particular incident or complaint that caused me to come to my decision. I firmly stated my case and didn't leave room to open my decision up for debate. He did, however, make an offer of "in-house consulting" that might have interested me if I wasn't FI. Basically it would involve me eliminating all my managerial responsibilities but remaining his direct report so I could consult on whatever projects/needs he wanted me for. For many reasons I didn't think this is something I wanted, mostly because I would still be dealing with the same people, projects, commute, etc. that I have today. And it sounded like the kind of role that could easily go away if/when he moves to another job. In the end I felt like accepting it would just put me into a "one more year" trap which might be harder to get out of next time. So....if you're still reading this far - in the end it went better than I expected. I was nervous all week about the conversation but once I get the actual words out I found that I was surprisingly calm. By the end I felt like a real weight was lifted off my shoulders. NOW I can really begin looking forward to my last day in around 4 more weeks! I'm happy to answer any questions you may have or elaborate further. Hope all our YOUR quitting announcements go as smoothly! [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| Thought of the day: On making decisions that just save a few bucks here or there. Posted: 03 May 2018 08:01 AM PDT We are animals governed by habits, desires, and intuitions. Although we might think we can look at every single purchasing decision in a vacuum, we don't. It's never just a matter of this thought on one single day: Should I sleep in an extra 15 minutes, and buy breakfast on the way to work instead of cooking it myself? It's only $5. The effects of the decision we make in that situation are not simply limited to that morning alone. That decision shapes our habits, and over time our habits shape our character.
But these things fucking add up, and none of them are done in isolation. Doing one of them out of discipline, actually makes me enjoy doing the next one with a bit less discipline. Eventually, these things build up enough that it doesn't take any discipline, because it's actually fucking FUN to churn credit cards or repair my own plumbing leak, and it becomes part of my personality to look for these opportunities. Enough drops can fill a bucket. Each behavior can snowball, they are positive feedback loops in the way they shape my personality, and actually mold by BRAIN to enjoy different things! Don't ask the question "Do I enjoy biking to work instead of driving". Ask "Do I want to become the type of person that enjoys biking to work instead of driving". And then start taking the actions that will shift your personality over time in that direction. [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| Daily FI discussion thread - May 03, 2018 Posted: 03 May 2018 04:08 AM PDT 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]  | ||||||||||||||||||||||||||||||||||||||||||||
| Posted: 02 May 2018 10:16 PM PDT Hi everyone! I feel that I am close to the brink of FI, and am starting to look at my work exit strategy. After working in the same industry with many of the same colleagues and bosses for over 20 years, it's not going to be as easy as a "later, sukkahs!" How have others left the workforce gracefully, and is it possible to do it without revealing the reason you no longer have to work in that field? Thanks! [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| New here! Making radical changes. Please tell me I'm not crazy! Posted: 03 May 2018 11:07 AM PDT Hello, I am F, 36, married w/ 3 kids. Husband and I are motivated to live a simpler life, save more money, and reach FI. We don't want to wait until our 60s to enjoy our lives! I'm in the process of selling or giving away almost all our stuff and need some reassurance I"m not crazy! I hatched a plan to move temporarily from our big house in Va down to my parents' 800 sq ft rental in FL (next door to them) to save about $1000/mo on housing expenses (we will rent out our Va house for about what the monthly mortgage payment is). We also are going to homeschool (or "unschool" the kids) to save on the $11k or so we've been spending on private school tuition. . . . This is a huge change for us but I'm excited! I'm realizing that people, experiences, and financial security are what I value in life. Not the big house and all the stuff! Has anyone done anything similar with kids?? ** Edited to add: this is a one-year experiment; we can move back to the house in Va (or a smaller one). Also, husband works from home and I am a stay at home parent with some side hustles.** Current household income is about $110k and our savings rate is maybe 10%--not great. Hoping to save and additional $20k+ over the next 12 months and maybe invest in another rental property that will cash flow. Thanks in advance! [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| Unexpected side-effect of savings: desire inflation Posted: 03 May 2018 12:09 PM PDT I have started to save more money thanks to having cut expenses. This means I now have more money at my disposal than ever before my life. And something interesting has started to happen. Now sometimes I catch myself thinking about spending in super expensive things that I used to fantasize about but never had the money to buy. Like a super risky business idea or plastic surgery procedures. They used to be just day dreams that I quickly dismissed because they were too expensive but also also not smart choices. But now that I can afford them a part of me seems to be more willing to throw my money at them without judgement. It is really interesting to me how being able to afford something means that I must work harder to remind myself that I don't need it. Thankfully, I don't think I'll give in, since the drive to retire early is stronger. [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| What to do with lots of extra money Posted: 03 May 2018 03:13 PM PDT So I am 20 in college as a junior. I've been working hard and landed a internship/co-op that pays 45k a year. I have to work fulltime in the summer and 30ish hours during the semester. Anyways, currently I have about 10k in subsides loans, and it will stay 10k until I graduate since next year is taken care of thru scholarships. I have an old but reliable car thats paid off and I live with my parents since I commute leaving me with essentially no bills. I figure this might be a good time to get ahead, what should I be doing with my money? [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| Talk me out of living in an RV trailer Posted: 02 May 2018 10:04 PM PDT I wanted to get some FI oriented people's perspective on this opportunity. I also want to note that my girlfriend and I do plan on building out a van and traveling in it once we FI, and we do well in small spaces, so this is appealing to us. A few months ago my dad bought a house and it has RV hookups (power, water, sewer). He said if at any time I wanted to buy an RV and live in it parked next to his house, he would love it. The girlfriend is welcome too, of course. He just asks we pay our share of utilities, and keep the area around the RV weeded. It's already perfectly manicured, so we wouldn't be hacking through a jungle. A few relevant points:
Here's my pros and cons list: Positives:
Negatives:
I can't ignore the possibility to get a massive jump in my SR. It's a golden opportunity as far as I can see, and I just want to make sure I'm not overlooking something very important. I guess my question is, would you do it? [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| Can we RE now? I'm lost as to what to do next. Posted: 03 May 2018 10:58 AM PDT Thanks for reading, and any advice... sorry for long post and throwaway account, summary first: We have good net worth ($4M), my wife and I are 42, kids are 8 and 6. I'm working but politics are going the wrong way at work and I likely can't stay there much longer ~1 month. Our current expenses are too high right now to be FI mainly due to medical expenses (although we have been cutting expenses in general for the last year). I'm wondering what my plan should be? I feel like retiring early and spending time with the kids while they are still young, but I don't have enough faith in our current financial situation. It would likely mean cutting expenses much more, or trying to go back to work in a few years. If we are to cut expenses more, where do we do so? It is still important to us that our family grows up as healthy and as well as possible. I'm afraid that cutting down on health expenses (and hence my 8 year old's future) is our best path, although we would minimize the damage as much as possible. Details: Net worth: $4M Primary residence: worth $1.6M in a great school district in a HCoL area with $1M loan (we do want the best for our kids and with special needs kids it seems school district is particularly important). Rental properties: $3.3M (with $1.5M loan). NOI $160k per year, cash flow a bit over $100k per year. We don't manage them as they are out of state. Loans are interest only for a few more years. Previous primary residence in UHCoL: This home is for sale but in a thin market, expect to clear $1.0M when it eventually sells (it has been on the market 6 months) 401k: $0.7M My job: I'm earning about $500k/yr right now. However I'm in a specialized subfield. I was earning ~1.2M/yr a couple of years ago. My team was canceled recently and I'm not finding another role right now at my (large) company or in the subfield elsewhere. If I do find something it is likely to be $100k-$300k. If I retire for a few years and want to come back things will likely be even more difficult for me. I might be able to make $500k if I spend weekdays back in the UHCoL area and fly across the country to spend weekends with my family. Our expenses: $200k With our move from UHCoL area to HCoL our expenses have dropped. We've also reduced nanny expense (we were paying a nanny full time on the books and that was costing $80k/yr). I'm not counting the running expenses of the UHCoL home that we are trying to sell. Once we do sell that home we could pay down mortgages to save $35k/yr Using Mint for the last 11.2 months, our expenses are:
Even with the expected aggressive reductions in expense if I retire we are still short $20k/yr. A note on health expenses: You may be wondering how they could be so high. Multiple serious issues for 3 family members. When the $200 per appointment specialist says our kid needs to be put off in a special school with help there and will always perform badly at school, we went to the $1000 per appointment specialist who firmly disagreed and then went about proving they were right with a treatment plan and normal school. The other parents in the class now are typically unaware our child has any issue, and she is in the TAG program. The expensive specialists' charges are above what insurance will consider, so it doesn't even contribute to out of pocket maximums. We have received several opinions from expensive specialists and they are mostly inline with each other. I also have some serious health issues but they are run-of-the-mill and I only pay $30 copay for those. We are careful to just do the expensive options when they will make a difference. So what now?
thanks, any advice appreciated! [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| 21 year old. Need advice about FIRE in Indian context. Posted: 03 May 2018 02:37 PM PDT Hi, first of all, I am from India and couldn't find an active enough sub of my region to post this on. So, pardon me for that. I will be graduating next year and will most likely get an IT job which pays around 80k INR per month after tax deductions. This is a good amount but I don't like the burnouts being so common in IT sector. My ultimate goal is to have a relaxed life without having to worry too much about money. I am not the ambitious or driven kind. I wish I inherited millions, lol. Now the thing is, I could spend next 20 or so years( I need specific advice on this from anyone who knows finances and all related to Indian context) doing a job that may not fulfill the 'relaxed' part and working towards FIRE. Or the best case scenario is that I am not too stressed by the job and spend/save like a normal guy, yay. Second option is a job I know for sure is relaxed and not too demanding, is teaching in good engineering universities (India only). But for that I would need to do Masters, PhD and postdoc, etc. All this estimated to go for 10 years. And pay is also decent enough. But the thing is I am not motivated enough. I don't know if I will be able to pull through 10 years of more studying. My question is, whether to take path one and try to FIRE as early as possible? If yes, then how? Or the path two, whose outcome I know will be satisfying, but the procedure (10 years of studying+ little uncertainty about good job/vacancy) looks a bit too demanding. Or if you guys can suggest some third alternative, that would be good too. Remember, I don't want to be rich, just enough to survive without worrying too much and having enough time to devote to myself. HELP. THANKS FOR READING. Edit : Salary 80k after tax per month. COL : 30-40k if single. For family : 60k per month. Taxes rate : 30%. [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| 17 year old wondering about FI Posted: 03 May 2018 01:02 PM PDT I'm currently 17 years old, graduating highschool in a few weeks (a year early) and plan on going to a cheap state-college with decent scholarship. I've been creeping on r/financialindependence for a couple months now. As iv'e been reading more and more it sounds like something that could be really beneficial and possibly fun. My wonderings are whether or not you would suggest starting a path to FI now through savings and investments or if I should instead hold off until later in life when i might be "better suited" to make decisions? By my reasoning there isn't any downside of starting now and if I ever end up deciding the FI/RE life isn't one i want to pursue I have some money saved while if i do end up pushing for FI/RE earlier is always better than later, right? Is there anything you would tell 17 year old you now that you know about FI or have made it to FI/RE? What other financial and or advice could you offer to a 17 year old interested (and excited) about FI? [link] [comments]  | ||||||||||||||||||||||||||||||||||||||||||||
| Posted: 03 May 2018 03:24 AM PDT Situation: Couple turning 60 this year and debt free. 788K in retirement accounts, plus a 40K employer contribution not vested until 65 and not included. 250K emergency fund in mutual funds 300K House no mortgage and 6k taxes per year 2 Paid for cars - 2 and 4 years old. Employer sponsored medical insurance. Only 2 years at current employer and wife works from home. Why FIRE? Enjoy life and do what I want. Hobbies - writing, reading, travel. 2.4 acre yard to maintain and 3800 sq ft house that needs some maintenance. Have a fiction novel in 2nd draft stage and need to finalize it to market it. Want to enjoy more time with 7 grandkids. We all live in the same area within 10miles. I like my job, it's the work I hate. Boss is a petty micro manager. If needed I can do short term consulting gigs. Been an IT consultant for 13 years and then took full time position after joint replacement surgery. Got suckered into position after surgery. Why not to FIRE 40-50k golden handcuffs till age 65. Current combined income is around 150k. Medical insurance at $520 pm. 4.5% withdrawal rate will not give us enough to live on. If I divide cash and retirement into 15 payments, we have 69k per year till age 75 and then we will have no money left. If I work for another 5 years, it will take us to 80. Not counting on SS that will be about 2-3k at 67.5 Question! What would you do ? [link] [comments]  |
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