Financial Independence FI and Friends |
- FI and Friends
- Ways to cut expenses with minimal sacrifice to quality of life
- New "cushy" job, no longer want to FIRE?
- Daily FI discussion thread - July 01, 2018
- What are your FI habits in your household?
- FI Help.
- How do you account for an annual pension when calculating your FIRE number?
- Partner and I want contribute different amounts to our SEP.
- How do you find the balance between saving and "experiencing"?
- Empower to make informed decisions
- Being a Progressive FI Person
- Using leverage to achieve FI?
- Fund Returns Over Time
| Posted: 01 Jul 2018 05:43 AM PDT Dinner last night with my long time friend, in our 30s. Financially, he's the only one I really know that has his shit together + wife, kid. We're both holding off as long as we can before having to buy a house. Both are saving. FI path's and mentality. Most houses around here are overpriced McMansion style or complete crap shacks. We have another friend: spendthrift, received $200 a week stipend from his parents for tax reasons on their end, blows it, saves nothing. Makes about 100K...always broke, gambles, etc. expensive habits Complained to us that his mom and step-dad shouldn't be taking so many vacations because their blowing his inheritance (his step-dad is an animal, built multiple business from nothing...destroyed back) But he's not the only one we see... Does anyone else see this in their day-to-day: with friends, family, co-workers? I'm just curious. My friend and I have no idea who are buying these shit houses in our area (super expensive) while our families are the only one's that seem to have it together trying to be semi-responsible... Ironically, spoke with a relator friend last month and got lunch. He told me after asking, that most people that buy houses are completely broke and can barely come up with the downpayment. Buying way too much house, with tons of debt leveraged up the ass. But how else are you gonna get those Facebook likes...right Curious to hear feedback and the perspective from the sub as it could be interesting...though 70% of American's live paycheck to paycheck so maybe not that eye opening. I can't be the only one says 'WTF' daily... [link] [comments]  |
| Ways to cut expenses with minimal sacrifice to quality of life Posted: 01 Jul 2018 11:20 AM PDT Long time lurker, first post. For many here the key to achieve FIRE is to save 25X (or 33X) expenses, so a (lifetime) cut in annual expenses is worth a lot. Obviously life choices like 'never eat out', 'never travel', 'eat cheap food' will help to cut expenses, but at some personal cost. What are some ways you've found to cut expenses with minimal sacrifice to quality of life?? For me: (1) I replaced all light-bulbs in my apartment with LEDs, which cost me < $100 and saves about $15/month (2) I renegotiate my cable bill every 2 years, saves me a similar amount. From a FIRE perspective, $15/month x 2 = $360/year, which cuts required FIRE number by $9K at 4% withdrawal. [link] [comments]  |
| New "cushy" job, no longer want to FIRE? Posted: 01 Jul 2018 02:21 PM PDT Old job was toxic. I hated my life. Every day I would go home worried about something. Started going super frugal to max out my investment accounts. Lived a diminished life (hate to say it but I didn't date much.) Did this for 5 years. Went back to school, and couldn't get a job. Had to work in a restaurant for 9 months. So roughly 3 months ago I got a new job. Complete turn around. My experience has given me added perspective. Job yes is boring, pays "only" 50k a year, etc. But I feel I'm already pretty close to maxing on my hobbies. Like, if I had 200% more free time I wouldn't know what to do with it. Weekend is enough for me (especially compared to random Tuesdays I had off at the restaraunt.) Actually, weekend I say is underutilized. Not really doing much except reddit. This is tough for me because I've invested so much in the FIRE community. Not only just reading r/fi and blogs, but I've gone to meetups, lived my life for super frugality, etc. What do you think? [link] [comments]  |
| Daily FI discussion thread - July 01, 2018 Posted: 01 Jul 2018 04:09 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]  |
| What are your FI habits in your household? Posted: 01 Jul 2018 04:26 PM PDT We don't often do ALL the "right things", but we do recognize the importance of budgeting, planning, weekly meetings, etc. What do you do in your household on a regular, ongoing basis that you think are your FI strengths? What is it that you do with your family on a regular basis that you think is most important to your FI success? [link] [comments]  |
| Posted: 01 Jul 2018 03:37 PM PDT Hi guys, long time lurker. First I just want to say how inspirational and helpful I have found this subbreddit and all of its informative posters! Second I'd like to apologize in advanced for any whineyness that might leak through! So, I've decided to turn my life around, and I ask, humbly, for a bit of guidance. I'm 21, college dropout. And for the past ~ 2 years I have worked full time, upwards of 65+ hours at week at some points (making aprox $10/hour.) And making ends meet has just been a nightmare. The extremes of my frugality can hardly be stressed and the existential spiral that started my situation has only made it easier for my life to have decayed to this point. I never leave the house (I've seen my family once this past year) and I stretch about $100 a month between food and gas. I'm happy to spend my time with borrowed boojs, and my idea of splurging is the $50 a month I spend on internet. Every time I start a savings (my highest atm has been $3k) some problem or another comes and I'm back down to zero. I've always taken financial literacy seriously and I have essentially been planning my retirement since I was 17. At this point in my life I have just felt like a failure as I watch siblings and former colleagues start actual 'adult' lives, snatching up 100k+ jobs straight out of graduation, marriages, moving far away from home etc. And I wonder where along my life I fucked up. The first year out of school I forgive myself for, my anger and lack of direction would have done me no good in school. Only in the last year of introspection have I found the determination to say I think I can achieve more. The people I have worked with have been so hard working, they put me to shame. But I just can't bear to slave away in a store I can't even afford to shop at with the shittiest car in the parking lot, wherever I go. I spoke with an advisor from my college, and starting August I will resume schooling. By this time next year I plan on having an AA in Integrative Studies and being on the right track towards a happier and more fulfilling life! Thoughts!? [link] [comments]  |
| How do you account for an annual pension when calculating your FIRE number? Posted: 01 Jul 2018 02:39 PM PDT Hello, this is my first post in the sub so if I am off base please forgive me. Life Situation: 31 married with one child on the way / Active Duty AF currently residing in SC but TX state resident for tax purposes Salary/Wages: My wife and I both work full time and earn $120,000 annually after taxes Yearly Savings Amounts: $40,000 Assets: Wife's Simple IRA: $12,500 / Roth IRAs: $137,300 / Brokerage Account: $384,000 / Banking: $20,000 Liabilities: None (Not homeowners, hasn't seemed practical with moving < every 3 years so we are currently renting) Specific Question(s): I'm currently 9 years into my active duty USAF career and planning on sticking out the 20 years to retire under the legacy military retirement plan at age 43. My question revolves around how to plan for financial independence realizing that a portion of my income will come from my own assets and another portion will come from an annual pension. The methodology I have been using is to subtract the after tax anticipated pension from our annual expenses and then apply the SWR to the balance. Currently our annual expenses are $77,000. My anticipated pension would be $47,700 after taxes under the current tax structure leaving a shortfall of roughly $30,000 annually. I know "counting" on the pension has its own implications but for the purposes of this discussion I believe the likelihood of the federal government defaulting on a military pension to be fairly low. Does the methodology described here make sense? I have an additional, somewhat unrelated question considering home ownership. My wife and I are unlikely to purchase a home until my retirement from the USAF or at the earliest roughly 3 years prior. As a result, we will absolutely still be paying for housing when I retire from the AF. How does having a mortgage payment and the associated homeowner expenses factor into your annual expenses calculation? Thanks for any advice! [link] [comments]  |
| Partner and I want contribute different amounts to our SEP. Posted: 01 Jul 2018 01:50 PM PDT I want to lead a life aimed at achieving FIRE. My partner likes nice(expensive) things. She doesn't want to max SEP. I do. From what I understand the contributions between equal partners MUST be the same. She's contributing 15,000. I want to contribute 54,000. Anyone know how we can make this work? [link] [comments]  |
| How do you find the balance between saving and "experiencing"? Posted: 01 Jul 2018 09:25 AM PDT And when I mean experience, like being able to enjoy with your friends when you eat out or treating yourself to a really incredible meal. I'm a college student and it's now my last year. For the past two years I have been living frugally, always putting the 10% in my savings the moment I receive my allowance. But now that I'm in my last year, I find myself thinking, "ah, what the heck!" and I haven't been saving lately. My mind keeps thinking, this might be the last time I get to be with them. And does it all boil down to delayed gratification? I won't buy pizza now, so I can buy pizza 3 years later? I kept thinking I'm 40, I got a ton of money. But I missed out a lot on my youth and probably lost connections with a couple of people. Anyway, I'm just really confused and I'm grateful for anyone on helping me out. :) [link] [comments]  |
| Empower to make informed decisions Posted: 01 Jul 2018 03:41 PM PDT Do you think that you are empowered to make informed decisions about your finances? If no, what do you think is missing? [link] [comments]  |
| Posted: 01 Jul 2018 03:10 PM PDT This is not meant to cause a debate about the ins-and-outs of politics. I realize there are varying opinions about how the economy should be run and I have great respect for those of you that have other ideas about such things. One of my favorite things is discussing and learning from you, but that's not what I want to do right now, if you will bear with me on that. Here, I just want to share some aspects of the FI journey that pertain to being a progressive/socialist pursuing FI. It'll be a bit like a manifesto I suppose, sorry about that but these are the thoughts going through my head as I push myself to save and invest as much as I can. I think it's a perspective that is a bit lost in the Fi community. The Problem First, a quick background that explains the crux of the moral problem with FI for progressives. For me, Capitalism is an amoral system because it places control over peoples ability to create things and services in the hands of a small elite. An economy run as a series of small dictatorships causes a lot of unnecessary happiness and suffering, along with the destruction of our environment and corruption of our democratic institutions. It is also inefficient and, in my view, stands in the way of the amazing things humanity can achieve together. Capitalism and humanism are incompatible, and I want a humanist life for myself and others. That view does clash a bit with the idea of living off of Capital, even if it is just tiny pieces of the economy in the form index funds like VTSAX. When I achieve FI, it will partially be through investments made in things like war, the debt industry, banks, and similar. Each dividend is a product of the exploitation of people's work. Why I Still Invest and Pursue FI It may sound cynical but I approach the moral problems I have with Capitalism in a calculated way. If I achieve a net positive result on achieving the progressive cause, I can live with myself. What this means is I allocate a sum of money to support progressive candidate each month, and volunteer when possible. That, in my view, contributes more than staying poor for the sake of trying to live outside this system. I didn't chose to be born into Capitalism but I'm privileged enough to have an education and be able to find a good job so I'll be dammed if I let it defeat me. The very least I can do is succeed and use that success to change things. FI = Power If you want to be someone that can create change in the world, it certainly helps if you can support yourself. Will you be able to take the necessary risks to your employment when it's time for a strike? Do you have the economic flexibility to quit your job and dedicate yourself to a campaign? Can you help pay for the flyers, buttons, campaigners, lawyers etc. that we need to win? If your answer to those questions is no, it is time to build out your emergency fund, get yourself out of debt, and begin investing so you can give. If that means having to participate in Capitalism, so be it (within reason, I'd not include working for e.g. ICE and similar in that). It's the End of the Starving Artist/Activist Trope for Progressives The trope of the starving artist/activist needs to go away for us to achieve the political change we want. Being intentionally poor may feel good to some but it does nothing to build actual political power. The socialist movements that built democracy back in the day knew this. Strike funds and the first left wing parties were funded entirely by their members, who knew how to save and invest in their political future. That is what we must do. In short, in a world where our political system has been bought by the rich, being financially able to support yourself and a movement for change is a radical act. So save, invest, know your privilege (if you have it) and be someone who uses the power of FI for change. [link] [comments]  |
| Posted: 01 Jul 2018 05:45 AM PDT I'm currently in the middle of a self-inflicted dilemma. I want to become FI, but I'm at odds between which path to continue down (pay down debt or get more debt). Maybe someone here can help. Background: 30-something, married, no kids Income:
Investing:
Cash:
Debt:
I have ~$70-80k in equity in my rental property that I would like to tap into (cash-out $25k) in order to purchase another rental property, but I'm obviously hesitant about getting into even more debt. As you can see, we already have these massive student loans hanging over our heads. I am not afraid of using leverage as a tool to accelerate FI, but I also see that we are coming close to hitting the 1M mark in the opposite direction (debt). I guess the tl;dr of this is: Is leveraging yourself to the moon a smart way to accelerate FI? [link] [comments]  |
| Posted: 01 Jul 2018 01:01 AM PDT There's a photo of a graph in a book that shows the probability of returns over the time that you hold on to a fund. It's super useful graph, I just wish I could find it. Anybody have this bookmarked? edit: I think it was uploaded onto Imgur [link] [comments]  |
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