Financial Independence Daily FI discussion thread - October 16, 2019 |
- Daily FI discussion thread - October 16, 2019
- I finally realized my "why"
- Intersection of FIRE and MN Bogleheads group
- Sacrificing short term FI to achieve long term FI sooner
- Weekly Self-Promotion Thread - October 16, 2019
- In pursuit of FIRE in the US, here is a fun video of states with the highest disposable income up until 2018. Thought it was interesting, and potentially actionable for anyone looking to move with a new job. Cross posted from r/alaska
- Does anyone consider retiring abroad to reduce cost of living and time to RE?
- I am conflicted about this movement
- Doubting Myself on Investments
| Daily FI discussion thread - October 16, 2019 Posted: 16 Oct 2019 01:07 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: 16 Oct 2019 05:29 PM PDT Many posts here urge the community to really consider their "why." Why are you pursuing financial independence? For so long, it's been easy for me to say, "I hate working." But when I shared that with people in real life, I was met with confused looks. "It doesn't seem like you hate working," many people would respond. And it didn't feel all the way right to me. I don't really hate working. In my jobs, I have had opportunities to directly help people and improve their lives. I have changed systems and operations for the better. I don't hate that. What I hate is the performance required. I hate the charade of working 8.5 hours even when it's not necessary. I hate that half hour that has to be unpaid because of lunch. I hate having to consider the optics of your decision to work a different schedule, take a three week vacation, or having a long lunch. I hate the endless meetings and documentation required to assure everyone you are, in fact, working. I hate the contests people have with one another on who is skipping lunch, who is coming in early and staying late, and who can't take vacation. It's bullshit. It's inefficient. It's unnecessary. And so that is why I want financial independence. To free myself from bullshit. [link] [comments]  | ||
| Intersection of FIRE and MN Bogleheads group Posted: 16 Oct 2019 06:48 AM PDT There's a lot of overlap in the views and perspectives of this sub and the Bogleheads group. Personally, the Bogleheads Wiki and forum have been instrumental in my own FIRE journey and I suspect the same is true for many others. In the reddit world, /r/financialindependence is quite a bit more active than /r/Bogleheads but it's clear both groups share much of the same philosophy and approach to investing (e.g. I'm guessing the Bogleheads Wiki is one of the top handful of most-linked sites when replying to threads). Along those lines, I've received the [edited] email below from the Minnesota Bogleheads group:
I'm not involved with the Minnesota Bogleheads group other than being on the email list. But I wanted to share this post with /r/FI in case there are other Minnesotans who may be interested. I think it's cool to see like-minded folks getting together to share ideas and have conversations on the topic. Has anyone else been part of this overlap/intersection between FIRE and Bogleheads? Any thoughts on the connections between the two groups? Have other Bogleheads groups done anything similar? [link] [comments]  | ||
| Sacrificing short term FI to achieve long term FI sooner Posted: 16 Oct 2019 08:21 PM PDT I realized something the other day. I currently have about $80k in my company's stock, and if I quit tomorrow, I'd lose about $50k of it. My company has an ESPP where you can contribute up to 20% of your salary, and they match your contribution 75%, but you have to hold it for a year or you give up the match. So if the stock was at $80, for every share I buy, I basically get $60 worth. That means the stock has to drop 43% (1 - $80/$140) before I don't at least break even. I'm confident in my company to at least stay even and a previous short sell of our company suggested our stock price will now double within a year. In general, it's stable and on the way up, so low risk. However, it does fluctuate and while I'm still up about 65% because of the match, I realized I'm facing a major "loss" if I were to quit in the form of the loss of this match and RSU's given as part of my annual bonus(not to mention we're down a few dollars since my march contribution). In short, in trying to get permanently financially independent sooner, I've made myself less financially independent in the short run. Prior to participating in the program, I could have quit my job without any hesitation knowing I had about 2 years expense in taxable accounts saved up(in addition to all retirement savings maxed) and I get regular headhunter calls. It made me realize that I can't quit without taking a $50k hit. I know rationally the money isn't mine till it vests, but I'm still giving it up. I'm ok with this right now since I enjoy my job, my commute is 3 minutes, and my job security is off the charts. They wouldn't fire me unless the company was going under and we're not at risk of that(even then, shares vest immediately and I get severance, so non-issue for this purpose). But something just bugs me about the realization I can't just quit because someone annoys me. I had FU money... but the ESPP match has tied me down a bit(but given me a 15% raise in the process). So I'm going to achieve permanent FI sooner... by giving up short term FI. What's the general consensus on sacrifices of freedom like this? Do you guys give up anything now just to get out sooner, or do you just look to continually increase your freedom with minimal setbacks as long as you reach the goal? Just to give reference point numbers: [link] [comments]  | ||
| Weekly Self-Promotion Thread - October 16, 2019 Posted: 16 Oct 2019 01:07 AM PDT Self-promotion (ie posting about projects/businesses that you operate and can profit from) is typically a practice that is discouraged in /r/financialindependence, and these posts are removed through moderation. This is a thread where those rules do not apply. However, please do not post referral links in this thread. Use this thread to talk about your blog, talk about your business, ask for feedback, etc. If the self-promotion starts to leak outside of this thread, we will once again return to a time where 100% of self-promotion posts are banned. Please use this space wisely. Link-only posts will be removed. Put some effort into it. [link] [comments]  | ||
| Posted: 16 Oct 2019 05:53 PM PDT
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| Does anyone consider retiring abroad to reduce cost of living and time to RE? Posted: 16 Oct 2019 11:52 AM PDT newbie here - I hope this question is beneficial and not a repeat. I'm thinking about retiring in a different country where my purchasing power is much higher. In the US I spend about 20k to live annually (500K needed for 30y retirement). However, the cost of living in Latin America, SE Asia, the middle east, etc is MUCH lower. For example in Indonesia, the Cost of Living Index is 44.7 (compared to 100 in the US). In theory, I would need a little more than 250K to retire for the same amount of time. Morocco is 45.9 so I'd need a similar amount to that and due to me using much less than the amount my investments should make (7%) annually, I'd actually be able to have more years of retirement. This sounds AWESOME! But I really wonder if others have done this and what their advice. - Do you recommend retiring abroad? - What are the necessary steps you took to make it work? [link] [comments]  | ||
| I am conflicted about this movement Posted: 16 Oct 2019 07:55 AM PDT I am 29 now, and I have made several moves to get closer to financial independence, but I am in a constant battle because of this: Should I spend more money doing things that are easier to do when you are younger, or should I save so I can retire earlier and try to do these things? The largest thing that has slowed down my financial independence is traveling the world, mountaineering, snowboarding, motorcycling, mountain biking, moving to new cities, etc. Now as I go into 2020 I am planning to snowboard 1,000 runs but it just has me thinking of this constant battle I am in. [link] [comments]  | ||
| Doubting Myself on Investments Posted: 16 Oct 2019 01:59 AM PDT This stemmed off a conversation I had recently with my coworkers, talking about how some people could afford to pay $50 for dinner during an outing like it was chump change while they had to share plates to save on cash. I mentioned that if they wanted to one day be able to afford to eat out for $50 a week, they should start investing early. I was shocked to learn that almost no one planned to do any serious investing. All they had ever done was invest the minimum amount required of their 401k and that's it. And it shocked me even more that they absolutely despised the stock market, claiming it's way too volatile to be any good, and that with talks of a recession around the corner, you'd be an idiot to invest now. I had been self-educating myself financially for a few months now. I came from a family that knew saving was a must, with a frugal mother that did day-trading every morning on the side and a thrifty father, who like my coworkers only invested up to the 401k company match. Ironically it was my father that introduced my mother into investing by opening her a brokerage account with his own money. Like my coworkers they were constantly afraid of market swings. Celebrations when money was made and arguments when money was lost. And so when I begin doing my own research on investing, my father did not take too kindly when I told him I would be holding onto my investments when the stock market dropped back in December 2018. He (and my mother) told me it was stupid to put all my saved money in when the market was doing poorly, that it would only go down some more and that I should wait until the recession (that never happened) is over. It's been nearly a year and my portfolio had grown just over 8% since, yet both my parents still insist timing the market is better than investing now, and that whatever advice I was reading up on was just a marketing ploy. Clearly, I must be doing something right. To not only have recovered my losses from Christmas and still make some gains after almost a year. I figured that if the financial advice I took a year earlier to put money in investments rather than stockpiling it in a savings account worked, I should take investing more seriously if I wanted to up my returns. From here it had been nothing but a rollercoaster of confusion and anxiety. No matter where I looked there seemed to be no solid consensus on what is the most ideal investment strategy. At first I got into robo-advisors. They managed everything for you at a lower cost and you could get into it without needing to buy the full price of an index fund. Then I heard about the fees that could chip away at your savings. Then it was stocks. I was told to avoid day-trading at all costs and that buy-and-hold outperformed them by a wide margin. Then I was told the stock market was too volatile and you had no control over it. Real Estate was better because it was feasible, offered stable income through rent, and huge capital gains through appreciation. Combined with some smart deals and a bit of leveraging, you could snowball your investments. But then I was told there was a lot of overhead and paperwork to deal with, combined with a slew of expenses such as property taxes, maintenance fees, searching for good tenants, covering for vacancies, paying off mortgages, etc. etc. Then I heard about dividend growth investing and how it could generate a stable income for the rest of your life without the worries of stock market volatility, and how dividend growth investments outperformed the market indexes by a substantial margin. Yet even now I'm hearing about how dividend growth is bogus and that simply investing purely into stock growth nets better returns while avoiding the pesky taxes that accompanies dividend payouts each quarter. And that's on top of all the other advice such as getting a better job, find a side hustle, start a business, write a book or upload on Youtube, whatever it took to up your income. I'm doing all I can at the moment, biting the bullet now so I don't have to do it later in life. I pay myself first before I consider budgeting for my other expenses, maxing out my IRA and 401k as much as I could and then paying for all my debts and life expenses before taking what's left over at the end of the month to invest in my personal portfolio. It's all for my future self. Or so I tell myself. So much of my investment money is heading into tax-deferred accounts that I can't even pull out until I'm a damn good ways near retirement unless I want to sabotage the earnings I've made up to that point. By then I might be too old to enjoy the bigger things in life that a young person could do right now. I could just invest more heavily to taxable portfolios now to take advantage of the gains sooner rather than later, but then I could severely hurt my finances making poor investment decisions and having to recover lost time from those bad choices. So when the vast majority of my coworkers caught me by surprise and said they don't trust the stock market, I couldn't help but feel I was way over my head. When I talked about my research and investments, they only shook their heads and stared. Here I was, one of a dozen people griping about how rich people could afford to spend so much, and I had the ambition to try and be part of a success story. To hit a million. To retire early. To not stress about life and enjoy it to the fullest. Yet I was the only one in the room that believed in it, and want to commit to it. Smart spending. Smart saving. Smart investing. That's all it took, I told myself. But how can I truly believe that, when so many people are fighting constantly about what's the better investment, what's the best course in life, what's the best use of your time and effort, and so many people seem to be on the other side of the aisle and I am just a tiny minority? An insignificant minority that's gone too far beyond reason and nothing but gullible fools? I curse myself now, and probably I'll curse myself in the future. I want to be ambitious, and I want to succeed. I want to do the things that I've always dreamed of as a child. But I don't want to be made the fool and gamble my entire life on a pipe dream. I want closure and consensus, facts and logic backed by reason and evidence. Not trendy fashions and popularity contests. I doubt I'll be able to go to anyone, ask their opinion, and get an insight on something that just about everyone understands. Finances seem to be the one thing everyone bickers on with no real unanimity aside from politics... but politics is conjecture. Finance is fact. My risk is my life. My investment is my current life. And my gains will be my future. That's really what finance is about at the end of the day. Not about the money, but the life you want to have. I hope to see one day that everyone will view finance as a tool to achieve the life we want and to help each other obtain that ideal life, and not as a barrier or obstacle to overcome or a weapon to exploit others. It hurts. But I will trudge through it, if only to prove those that doubted me wrong. They can drive their Teslas, flash their new iPhones, wave their Masters Degree and flaunt their high positions. Let them. Arrogance is no replacement for ignorance, and I look forward to the day I become the one paying their salaries instead. I will fight for my life, and I will be free. [link] [comments]  |
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