Financial Independence "Quest for FI Completed" ... Baffled that I Cannot Quit ... Disappointed in home downsizing |
- "Quest for FI Completed" ... Baffled that I Cannot Quit ... Disappointed in home downsizing
- The FIRE Movement is Here to Stay
- Rent vs. Buy - Will renting soon be a no brainer and how do we protect ourselves during FIRE?
- Daily FI discussion thread - January 29, 2019
- Receive a free $5 in two minutes, hope this helps you redditors out with something!
- Career change for financial benefit
- Is opening an account worth it?
- Question for Fire Fans: Need Help Deciding Between SO's Fire Path and My Wealth Path
- Reducing working hours vs. FIRE earlier (9 to 5 employee in his 20s)
- Favorite FIRE focused Audiobooks?
- Macroeconomic impact of people choosing to Retire Early following Financial Independence
- What habits contribute to FI?
| "Quest for FI Completed" ... Baffled that I Cannot Quit ... Disappointed in home downsizing Posted: 29 Jan 2019 06:40 AM PST For many years, we have been locked into the "work/save/invest" ethos. It has worked to the tune of $2.6mm in investments with an annual spend of $85k. I am mid 40s while she is late 30s. In an interesting twist of fate, I find myself unable to hit the stop button on the career that helped build our war chest. I do not particularly love it and I am more than a little surprised that I cannot walk away. Granted, there is some underlying fear but I cannot identify it. More than anything it could be the social aspect of the job (and the free car & expense account?). Travel, reading, painting, hiking, sporting events, daily exercise and volunteering all hold great appeal for us so there would not be a lack of things to occupy our hours. Further, in order to make our spending more predictable, we recently scaled down in our LCOL area to a 1900 sq ft townhome from our 5000 sq ft mcmansion. We have no kids so, mostly, we had a lot of wasted space. That being said, it was wonderful to host parties and family over holidays. I severely miss the comfort of movie nights in our theater room & the ability to welcome friends (while maintaining room to breathe). I know -- 1st world problems to be sure. Given my inability to accept the "RE" piece of FIRE, I am considering a few more years of toil in exchange for long term comfort of a larger home. Spend will obviously jump to 100k or so and the wildcard of travel can always be reigned in (it's around 20k of our 85k spend now). If we were not in the snowbelt then retooling our housing (again) likely would not matter -- we are and it does, more than I ever imagined. We welcome all opinions on how you would handle this. "Am I crazy for going in reverse?" may be the actual question here. Thanks for giving this a read. [link] [comments]  |
| The FIRE Movement is Here to Stay Posted: 29 Jan 2019 08:11 AM PST Good article in this blog, reviewing the evolution of the FIRE philosophy in general and dismantling the most popular myths.
Personally, what seduces me most about this is its moral component. Systematic saving, leaving aside its financial aspect, has a great moral component behind it. If we manage to live below our means, if we aim to be less materialistic and if we make an effort to dedicate our free time to the things that really matter, we will not only be happier, but we will be giving meaning to our lives. The least important are the numbers. [link] [comments]  |
| Rent vs. Buy - Will renting soon be a no brainer and how do we protect ourselves during FIRE? Posted: 28 Jan 2019 08:22 PM PST Pardon my rambling post. What are renters long term protection plans to runaway housing costs 20-40 years out? The focus is rent vs. buy calculators are great if you are in a rent control home. Otherwise, it seems as FIRE renters we are setting ourselves up for a mid-FIRE crisis. It seems like right now the rent vs. buy in any "want to live in" city from San Francisco, Los Angeles, Bozeman, Portland, Boulder, <insert your favorite city here> I could go on and on...and on, has a housing shortage. There is a growing trend between the cost to purchase and the price of rent, where renting is far cheaper than owning. Put it in your rent vs. buy calculator for these cities and renting is winning far more than buying and usually by a significant amount. Hundreds if not thousands of dollars per month saved renting. It's investors chasing returns anywhere possible and parking money. Nothing about the quality of the city, families, walkability, blah, blah, "insert realtor fallacies here" The test: Go on Zillow and find 10 homes for sale in a desirable part of town. Now go on craigslist and find a house or apartment on the same street, maybe even the same home and its last advertised rental amount. Without fail in all of these places 9 out of 10 times I'm finding it's far cheaper to rent than purchase the home. Example. A home in Bozeman is renting at $1,400. Its purchase price is $429,000 (mortgage + taxes around turns it to a $2k monthly ownership outlay. Not including maintenance, etc.). A condo is renting at $1,100. The same condo is selling at $389,000. In Santa Monica, an apartment two blocks from the beach rents for $2,400. A 1 bedroom condo on the same street sells for $750k + 750 HOA. I've done this for dozens of cities and hundreds of homes in these cities as I look for investment properties. The numbers never work. You can add in the metric of average income per household for a city and find that the average in those cities doesn't make enough money to pay the mortgage costs. It's mind boggling. With FI on my mind the goal is to not lose (locked out of my favorite place to live) in this housing battle. I understand predicting long term is "speculation" so call this a fun exercise. How do we not lose when renting wins the rent vs. buy calculator over a 30 year span? In Santa Monica you have rent control that protects renters that choose to FIRE. I could stay there for life, but I find rent control has a terrible influence on critical life decisions such as how big of a family to have, when to couple up, or anything that might influence you leaving the rental or outgrowing it. In San Francisco - rent control can also be used for protection, but only in certain parts of town and buildings of a particular age. In other cities and states where rent control does not exist, those that choose the rent vs. buy calculator option could find themselves forced to move to a second, third, or fourth tier city or a bad part of the city that is affordable. You might say - big deal, But that little move will reset your rent 20 years from now. It will change your routine and the people you've built relationship with over time. Your friends will now live a far driving distance from you, ultimately breaking relationships. You have to find new running route, biking routes, and hobbies reframed for whatever weather or terrain you end up being able to now afford on your FIRE income, since you chose to be a FIRE renter and you are now 20 years in the future and at 20 year future "market rate" rents. One thing I've also noticed, people use to say, "Only buy if you are going to live there for 10 years". Then it went to 5 years. I just read someone on this forum say "Buy if you are going to stay for at least 3 years". I thought that was absurd, but reflecting, if you can afford it and have plans to FIRE within 10 years maybe you buy no matter what simply for the protection. If you get locked into your house due to a crash, then that's where you are going to FIRE and that's the worse case, not all that bad because you still get to FIRE in a place you are already familiar and have built relationships around. My strategy is I rent my primary residence in a rent control location (luck, not part of this equation). To offset my rental, I've decided to purchase a rental property in the cheapest house to purchase city with a great quality of life that I'm excited to FIRE in, but can't today due to my work. To me this is my rental offset program. If housing goes down and my retirement property plummets, I'm hedged by my rent vs buy savings. Today a portion of my rental savings is diverted to pay for the mortgage on my future FIRE rental home where the rental income doesn't cover the mortgage. No property investor in there right mind would say that's a good deal, but this isn't about income investing. It's all about protection and not being trapped during FIRE or being priced out of housing 20 years out. I also happen to live in a rent control apartment today in a great location, but a determined investor can wreak havoc on a rent control tenant to the point of it not being worth it and ultimately kicking you out (see previous remark of welcome to 20 years in the future rental rates). This is inevitable for any rent control property if investors continue to chase anything and everything for a place to park money and a tiny return. Name a city and find its "housing crisis". Funny given we had a big ole housing bust followed by some of the lowest population growth ever in the US and now we don't have enough housing. https://finance.yahoo.com/news/boulder-can-teach-nation-housing-crunch-180135043.html https://www.huffingtonpost.com/entry/san-francisco-housing-crisis_us_5750a95ee4b0eb20fa0d682e https://www.opb.org/news/series/greetings-northwest/a-look-back-at-oregons-housing-crisis/ Population growth: http://www.multpl.com/us-population-growth-rate/table/by-year [link] [comments]  |
| Daily FI discussion thread - January 29, 2019 Posted: 29 Jan 2019 03:07 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]  |
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| Career change for financial benefit Posted: 29 Jan 2019 01:32 PM PST Hi there- Anyone out there that decided to make a change of career simply for the money potential? How was the process of changing careers, did you find it worth it, would you do it again? Any advice to someone who feels stuck in a dead-end entry level job in a career path that's potential is low in a HCOL area? [link] [comments]  |
| Is opening an account worth it? Posted: 29 Jan 2019 03:52 PM PST This is probably an inappropriate question given the audience, but I've been questioning the benefit of opening a retirement savings account in my circumstances: - I am a foreign citizen and not planning on staying in the US long term. I know I can leave the account to grow or can withdraw the funds whenever I leave the country, but since that would probably happen in a few years, I won't have time to get a good return. - After taxes and other deductions for healthcare etc, I make $40k net. It seems that I need to give up more than $400 per month to retirement in order to get something decent in decades (yeah I'm working towards making more!), but I'm not comfortable allocating that much to retirement savings at the moment. - I am in my early 20s. - I feel like if I did save for retirement now, it would be for participation's sake with a low enough amount that it really wouldn't make a difference. - Also, I am not planning on retiring in my 40s. What do you think? [link] [comments]  |
| Question for Fire Fans: Need Help Deciding Between SO's Fire Path and My Wealth Path Posted: 29 Jan 2019 02:34 PM PST I've been binge reading this sub for the past few days as I've been grappling with a retirement question. Thank you to everyone for so much insight! So, here's the situation. My SO wants to retire in a few years when our investment/retirement accounts are projected to be $1.7M. We have no debt outside of our home ($250k equity). I would love to have them go 5 more years and work towards getting go $2.5M in investment/retirement accounts before they hang it up. I am self employed and plan to work for at least another 25 years slowly tapering off over that time. Our financial models include very conservative estimates of my income due to the uncertain nature of self employment. We can make the $1.7M work and would have plenty of money to spare probably due to my income. But man...5 more years would move us to the "wealthy" category where our nest egg would continue to grow beyond what we pull for living expenses post retirement. Those 5 years would be a lifestyle changer. Would you guys consider working 5 more years for money you didn't need if it would make that substantial of a difference in long-term security and wealth? [link] [comments]  |
| Reducing working hours vs. FIRE earlier (9 to 5 employee in his 20s) Posted: 29 Jan 2019 02:55 PM PST So, reducing working hours instead of FIRE potentially earlier in my working life getting more and more interesting to me. I feel like "wasting" too much of my productive, best lifetime for chasing money which is a means for the purpose anyways. But first let me get you some background of myself:
Don't get me wrong, I really like my pleasant 9/5 job but I feel like I am "wasting" the best time in my 20s. Reducing my working hours from 5 days a week to just 4 days would not put my current lifestyle on risk and only decrease my savings rate a little bit but would greatly benefit my life satisfaction (that is my hypothesis at least). Reducing working hours in my job should be possible since it is a high demanded field. My plan is to use the "free time" for the following (just some main examples):
So the general question is to use the FIRE education to benefit more in the presence or to enjoy it (much) earlier but completely in the future? Do some more experienced FI users had the same struggle in their life and can share some of their thoughts with me? This would greatly help me with my decision or the general attitude to this. [link] [comments]  |
| Favorite FIRE focused Audiobooks? Posted: 29 Jan 2019 10:07 AM PST I'm going to be cancelling my Audible subscription but before I do so I need to use my (5) credits. I can buy any (5) audiobooks and then download and cancel. What are your favorite audiobooks? I do realize some books are better as audiobooks than others (easier on audio, read by author, enthusiastic vs monotone, not many visual references, etc.) My favorite so far has been JL Collins "A Simple Path to Wealth". If anyone has any similar to his in any way I'm sure I'd love it. I listened to his twice! I find audiobooks much easier for me as I can do 1.5 hours a day just during my round trip commute, and occasionally during lunch. Thanks all! [link] [comments]  |
| Macroeconomic impact of people choosing to Retire Early following Financial Independence Posted: 29 Jan 2019 07:04 AM PST As the FIRE movement becomes more and more mainstream, I cannot help but wonder what might be the effect on the world economy and the aggregated financial markets. Mr. Money Mustache tackled the issue in the past, but I was wondering if some economist has taken the time to analyse the possible impact of people turning frugal and dropping out of the work force in large numbers. [link] [comments]  |
| Posted: 28 Jan 2019 09:39 PM PST What habits contribute to Financial independence for you, both directly and indirectly? Edit: some things that i though of for myself that I believe I directly contribute include writings my goals daily, exercising regularly, flossing. Etc. [link] [comments]  |
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