Financial Independence Last day of work today. Ever. A few observations.... |
- Last day of work today. Ever. A few observations....
- "Living paycheck to paycheck is disturbingly common"
- [2018] Year in review. Part 1 of what I hope to make an annual contribution.
- As you approach financial independence, how do you stay motivated at work?
- Daily FI discussion thread - December 31, 2018
- Have any small business owners here sold their companies in their 30's and retired early?
- Should I sell my home?
- The post you've all been waiting for from MMM (Divorce)
- Happy new year! What are your objectives/goals for 2019?
- Weekly FI Monday Milestone thread - December 31, 2018
- What motivates you on this journey?
- Year-End FSA Info: If you are switching from an FSA to an HSA after the new year and your FSA has a grace period or allows for carryover, you need to deplete your FSA by today in order to be able to contribute to your HSA immediately
- How can the US stock market gain 7% on average per year, while the economy only grows 1-3% annually?
- Taking differentes % after RE
- Just tell me what to do so I do it
- Long term impact of frugal lifestyle on middle/high schooler?
- Teacher needing advice on how to achieve FIRE
- UK/US FIRE and TAX (is a total pain in the A***)
| Last day of work today. Ever. A few observations.... Posted: 31 Dec 2018 04:31 AM PST After nearly 40 years I'm retiring today in my early 50s. I have noticed a few things that I thought I'd share. First - we've covered the financial stuff on this sub ad-naseum. My family will be fine financially. Similarly medical care, etc. is going to be okay. That stuff is just business anyway, and we spend far too much time on business in our lives. The first thing I noticed is that I'm accepting increased invisibility. Not working will mean fewer people come to me for my expertise and guidance. Fewer accolades and successes in the corporate environment I have embraced for a few decades now. I'm looking forward to this invisibility and anonymity! It will give me room to be more authentically 'me'. I have also noticed that by divorcing my brain from daily work I have allowed more room for thoughts of my family and friends' situations. I'm already more aware of what is happening around me just from the change in focus. The final thing I'm noticing, somewhat related to the above, is that I no longer have to keep up that professional wall around me. I have always maintained a distance from my co-workers, and I see that tendency bleeding over into my home life. It is difficult when you are required to compartmentalize your thoughts and emotions in order to maintain a professional demeanor. I'm no longer going to have to do this. Anyway - Just wanted to share some unique perspectives as a person who finally reached my RE date! [link] [comments]  |
| "Living paycheck to paycheck is disturbingly common" Posted: 31 Dec 2018 07:56 AM PST "Living paycheck to paycheck is disturbingly common" - Washington Post I was struck by the difference in tone and attitude in this article compared to FI community. I do realize "unable to come up with $400 in an emergency" is reality for many people (most?). And trying not to pass judgment, but to better understand the realities others face. I know some people in this boat. For me, it was a nice reset of expectations around how people outside the FI community view finances. Sometimes I find myself in a bubble reading FI content. It's good to pull back a bit and get context. Edit: formatting [link] [comments]  |
| [2018] Year in review. Part 1 of what I hope to make an annual contribution. Posted: 31 Dec 2018 02:41 PM PST Hello all, this year in review is something I've been wanting to contribute for a couple of years now but just had not gotten around to. As long as it doesn't break any rules and we continue to get something out of it I would like to make it a bit of a tradition. Background For the last 4 years on December 31st I always crunch some numbers to see how the wife and I made out. I add up all of our major assets, subtract all of our major debts and come up with our net worth and find the year over year change. I then separately add up our retirement assets (essentially net worth subtracting home equity), figure out our monthly expenses and perform some rudimentary calculations to project how many years from achieving Financial Independence we are. Note: I actually began tracking all of this in the middle of 2015. So there is a bonus 6 months at the start that can be more or less disregarded for purposes of looking at annual variations. 2018 Results On the whole our retirement funds took a bit of a beating returns wise, but through contributions and diversification we've been able to ignore that and power forward. The big wins for this year were debt elimination and a growing cash balance, freeing ourselves of all but the mortgage. Below are the numbers:
Raw: https://imgur.com/a/wmxt0jw Thoughts 2018 was a good year as far as the numbers are concerned. Pretty much all of the important categories went in the direction one would hope. I'm most proud of the debt reduction and the fact that saving on interest payments helped bolster a decrease in average monthly expenses. That combined with increased income and maxing of both 401k accounts for the first year ever meant our savings rate actually increased, yay! That was honestly unexpected given our budget categories increased slightly. I still think that there's some room for improvement. Next year I'm looking forward to hopefully getting a 401k match from both of our employers (only 1 matched this year) as well as continuing to reduce debt by lowering our mortgage. I think that if we work hard we can eliminate pesky PMI (nearly $70/month ugh) by years end. We still need to focus on building a stronger e-fund the first half of the year as well as up until this point we've been balls-out debt eliminating and slowly mixing in retirement savings. I'm a bit saddened that with all the hard work we only shaved off a single year from our FI date, but I suppose with the market being what it was I'll take it. If next year was more of the same I wouldn't be too sad about it with CAPE still being fairly high. The only thing that's constant is change, so who knows what next year will bring! In the meantime I look forward to continuing to reading these forums, trying my best to not check balances until a year from now and chipping away at the mortgage. If anybody has any questions or tips let me know. Like I said, first year trying this so figured I would see how it goes but at the very least may provide some insights others had not considered and hopefully some people can provide some tweaks/things for me to consider as well! Let me know what you think. [link] [comments]  |
| As you approach financial independence, how do you stay motivated at work? Posted: 31 Dec 2018 12:29 PM PST I haven't reached independence but as the light at the end of the tunnel gets closer I seem to give fewer sh!ts at work. I still add value. But I'm not going out of my way to get promoted, schmooze, etc. I can't decide if I'm misdiagnosing reduced stress as apathy. [link] [comments]  |
| Daily FI discussion thread - December 31, 2018 Posted: 31 Dec 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]  |
| Have any small business owners here sold their companies in their 30's and retired early? Posted: 31 Dec 2018 09:12 AM PST It seems like the FIRE movement is geared mostly towards corporate folks who earn a lot, save their money, and retire early. However, I'm interested in hearing how small business owners and entrepreneurs feel about the FIRE movement. Would you prefer to retire "inside" your company and simply scale back your hours or would you sell your company for liquid assets and retire on that? [link] [comments]  |
| Posted: 31 Dec 2018 10:23 AM PST Hi all. I'm super new to the FIRE journey, so please forgive any ignorance. Just here to solicit advice. My total income is 67.5k per year. My partner and I bought our house 2 years ago. We live in a college town, and the cost of house prices has skyrocketed. We bought our home for $175,000, and are confident that we could sell it for $240,000. We would use the profit to pay off ~20k of debt, and buy land with the remainder in a less expensive state. We want to buy acreage so that we can move to a more self sufficient life style. I have opportunities to work remote at my job, so we would live somewhere less expensive with ideally the same salary. This way we can pay off a home we would build, and save/invest for retirement ASAP (ideally around 50 years old), as I can't handle the existential implications of knowing I'm going to be in the American workforce until I'm 65. My question is, should I sell my home? I've been hearing a lot about investing in real estate. We only owe about $165,000 on our home, which we could probably pay off, along with our other debt in ten years (or less with a more vigorous payment plan). Would keeping the home as an investment plan (for renting possibly) be a good idea? I could probably rent for about 1400 a month. Renting does seem kinda shitty... I don't know that I would love being a landlord. Also, 1400 is decent, but with the costs of repairs, I'm not sure it's even worth it. To sell, or not to sell? [link] [comments]  |
| The post you've all been waiting for from MMM (Divorce) Posted: 31 Dec 2018 04:21 PM PST |
| Happy new year! What are your objectives/goals for 2019? Posted: 31 Dec 2018 04:17 PM PST What are your objectives and goals for 2019 and how do you plan on achieving them? Will you be changing anything from the year give by or keep steady at the helm? [link] [comments]  |
| Weekly FI Monday Milestone thread - December 31, 2018 Posted: 31 Dec 2018 03:09 AM PST Please use this thread to post your milestones, humblebrags and status updates 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! 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 motivates you on this journey? Posted: 31 Dec 2018 03:31 PM PST Hey everyone, I'm new to the community but I feel like I've found a great resource of likeminded people. I've always been a habitual saver/investor, and while I don't keep a strict budget I manage to put away over half of my pre-tax income. I graduated from college this year and got a good job as a financial analyst. I have minimal debt (a 10 year student loan note with an APR below a what I'm getting from high yield savings for the little bit that wasn't covered by a scholarship; and a very reasonable car lease - I really wanted a new car for the first time in my life upon graduation and I got a great deal, but I'm thrilled with the car despite the suboptimal financial decision), and at 23 I have roughly 2x my annual salary saved (odd jobs in high school which compounded in the market, and I worked and had paid internships in college). I wanted to hear from you all about what motivates you to stay on this journey, and to be a little more specific, beyond just being financially independent. Is is a spouse/kids you want to spend more time with? A hobby you want to do full time? To move to a private island and never see another human again? I want to hear from everyone, but especially those more than ten years from reaching FI. Plus, as opposed to the question posed earlier today, what motivates you holistically to adopt the mindset as opposed to just at work as you approach FI. I hope everyone has a great new year, and I look forward to getting involved around here! P.S. This account is only for financial related subreddits since I don't want the people who know my other to have more insight then they have to regarding my finances. [link] [comments]  |
| Posted: 31 Dec 2018 01:10 PM PST
https://www.hsaedge.com/2018/02/17/hsa-contribution-with-fsa-carryover-grace-period/ So if you have a balance in your FSA still and your cafeteria plan has a grace period or carryover and you're switching to a HDHP and HSA next year, get out to a pharmacy today and buy eligible items using your debit card to deplete your account. If you don't, you won't be eligible to contribute to your HSA until the first of the month following the end of the grace period. [link] [comments]  |
| How can the US stock market gain 7% on average per year, while the economy only grows 1-3% annually? Posted: 31 Dec 2018 10:01 AM PST Don't these eventually have to come into alignment or else the stock market would eventually consume the entire economy? [link] [comments]  |
| Posted: 31 Dec 2018 08:39 AM PST I've seen people taking a percentage of their retirment money, say 2.5%, and then the next year they take 5% as they go on holiday or something like that. What'd you think of this ''strategy''? [link] [comments]  |
| Just tell me what to do so I do it Posted: 31 Dec 2018 03:26 PM PST Should I be plugging away at my 401K tax deferred limit or going the index fund route? Combo? I'm a passive investor and don't have an appetite for managing much of anything. Also, am I fooling myself? We have 10K student loan and 9K car loan debt. Should I pay these off first before doing anything? Our goal is to do part time work by age 45 (we're 30 now) and use passive income to supplement. We're saving for a down payment on a second home to rent our first place. Random. Thanks again. We need to get on course and focus—figured crowd sourcing is best since I can't get a straight answer from Google or a financial advisor at that! [link] [comments]  |
| Long term impact of frugal lifestyle on middle/high schooler? Posted: 30 Dec 2018 04:48 PM PST Curious to know of other's experiences. My husband and I have lived frugally relative to our peers for ~20 years. Retirement goals met, house paid for, HSA well funded, college saved for, solid job that i enjoy. Problem is we live in a less than ideal school district so we chose to go private (cheaper than moving - transaction costs, higher cost of housing, higher taxes etc) since we only have one child. We naively thought going to a religious school that we'd be with families who value a less materialistic lifestyle and who also subscribe to benign deprivation (deliberately depriving your child of some of their wants for long term lessons on what they should value). Wow were we wrong. Great people but many of their homes are over the top and they often lavish indulgences that we choose not to. We are now seeing social impacts of our choices on her happiness. She no longer invites friends over for sleepovers. She's too sweet to say it directly but all of her friends live in lavish homes and ours is quite modest by their standards. We know our home is actually nice compared to a real world normal but to a teenager they don't appreciate this worldly view, they only know their own normal. Changing schools at this point would likely be emotionally disruptive for her and she is getting a great education. So...do we hang tight and stay the course and trust that we are raising her well for the long run OR are we creating life long self esteem issues and should we step it up a notch to fit in a little better with this temporary norm? Thanks for thoughts. I have waivered for years on the right thing to do and we only have a few precious years before she leaves the nest. [link] [comments]  |
| Teacher needing advice on how to achieve FIRE Posted: 31 Dec 2018 02:21 AM PST Is staying in the Teachers' Pension the best way for me to achieve FIRE? Hello, I would really appreciate people's feelings with regard to the question above. A little about me - Income per year: £45000 Income per month after tax and deductions: £2500 Costs- mortgage: 600 (at 1.94%) Bills: £350 'Living' (food, car, social, clothes, etc.): £900 S&S ISA contribution: £100 SIPP contribution: £80 LISA contribution: £300 Savings: £75 Wealth - Savings: £700 S&S ISA value: £6000 LISA value: £1700 SIPP Value: £16000 Value of house: £300, 000 (equity= £90, 000) - note this has a 20% equity loan attached Local Government Pension Scheme: £400 a year from age 60 Teachers Pension: £9535 a year from age 68 State pension: £4000 a year from 68 Age: 36 in July FIRE Targets - Lean FIRE range = £12000 - £14999 per year (£1000 - £1599 per month) Clear FIRE = £15000 - 17999 per year (£1600 - £2499 per month) Exceeding FIRE = £18000+ per year (£2500 per month+) All targets assume I've cleared off the mortgage debt. I've included a substantial 'buffer' - I can get by on less than £1000 a month, but aim to have a lean fire range above this to give me more flexibility. My goal is to achieve FIRE ASAP. Not because I want to give up work, more so that I have the freedom to choose what work I do / focus on finding more pleasure / happiness from life. So, I would like to know if you think remaining in the Teachers' Pension is beneficial for achieving my goal. I know it's good value - it's a guaranteed income. Plus, it increases in value every year by: CPI (Consumer Price Index) capped at a maximum of 3% + 1.6% if you remain in service. I contribute around £400 a month before tax, and add an approximate value of £60 in total value per month as a result (so about £700 a year). All my guaranteed pensions combined should give £1145 approximately per month should I stop contributing now (State Pension + Local Government Pension + Teachers' Pension). This is in my lean FIRE target range. So whilst it is good value - I'll have a good guaranteed income from 68, I'm not sure it's helpful for achieving FIRE...I want freedom sooner, rather than later. I would really appreciate the thought from the FIRE community :-) [link] [comments]  |
| UK/US FIRE and TAX (is a total pain in the A***) Posted: 31 Dec 2018 03:22 AM PST First let me preface this, I will be talking to a US Tax specialist accountant in the UK, but want to get a better feel for what I need to ask, and what the overall position is, as I doubt I'll be able to find one who is also versed in FIRE, and high savings rates/Dividend income from a modest salary. I have UK/US dual Nationality, and looking now to set up my investment accounts. I was born, brought up and live in the UK, but hold a US passport. All my income has been earned in the UK. If I was a UK citizen only, I'd put it in an ISA (individual Savings Account) which is up to £20k a year investment, and all gains/dividends/Interest is tax free for life. Job done. However the IRS doesn't recognise this as a tax-free account, and from what I can find so far will tax all gains at around 30%. This add a couple of hundred thousand onto my FIRE number. Does anyone know if I can open a US tax efficient account in the US with no income earned in the US? How do they work? I have family in the US, so could have an US forwarding address, though it is in a HCOL state/county. I don't plan to remain in the UK for the rest of my life, so I am not too worried at this point about having my investments in a different country. [link] [comments]  |
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