Financial Independence Daily FI discussion thread - August 27, 2020 |
- Daily FI discussion thread - August 27, 2020
- Today cemented why FI is so important.
- Is anyone here looking to FIRE and then start their own business , especially an artistically one?
- Personal weakness - how to not talk about your net worth
- What’s it like to be rich/wealthy?
- FIREd and could really use some advice on a withdrawal strategy: which funds to withdraw from first?
- Hit My First Milestone at 25 as an H1-B Worker - Net Worth Equal to My Salary
| Daily FI discussion thread - August 27, 2020 Posted: 27 Aug 2020 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]  |
| Today cemented why FI is so important. Posted: 27 Aug 2020 03:01 PM PDT Some of you may have seen the recent hurricane that hit the Texas/Louisiana border. It was a massive storm that completely ruined the city of Lake Charles, LA. My town was going to be ground zero until a couple hours before the storm hit. It veered East and we were spared the complete devastation. We evacuated Tuesday because our mayor begged people not to stay behind and risk their life. My company drug it's feet on whether we would be "allowed" to evacuate. It wasn't until the judge issued a mandatory evacuation that we weren't forced by work to stay. I woke up today and found out that our town and home were safe and sound. The storm passed around 5 am. I got a call from my boss around 10am asking when I was coming home. Our regional manager is now furious that we are not at work today (5 hours after the storm passed) and that we are abusing this to take a vacation. I told my boss that this was no vacation. Wondering if the house I've worked my ass off to have would be ripped to shreds. Wondering if the nursery we have put together for my future son would still look the same. Instead of sympathy from management, the employees were treated like an enemy of the company for trying to keep their family safe. I ramble so much about this because I work with people who have to take this treatment. Paycheck comes in, paycheck goes out. They have to endure it. I'm not close to my FI goal, but I know that on the horizon I will be able to walk away from a company that has reduced me to just a production number. It is important to keep strong on the journey. I have questioned if it's possible to be free one day, but now I know that not only is it possible, it's necessary. [link] [comments]  |
| Is anyone here looking to FIRE and then start their own business , especially an artistically one? Posted: 27 Aug 2020 08:04 AM PDT My fiance has been getting into woodworking and creates really unique and amazing interior pieces. He'd like to take that full scale if we FIRE. I haven't been able to decide but I'd like to open up a unique and high quality local bakery with an attached cafe and/or become a vertical garden designer. Because of this, our FIRE needs are going to be higher so we can support ourselves and our businesses (if they aren't generating profit). For the cafe/bakery, we're thinking of buying a building and renting it out so that when its time for me to open my shop there will be lower costs. Is anyone going through this path of FIRE in order to pursue a profession that might not have much demand/difficult? [link] [comments]  |
| Personal weakness - how to not talk about your net worth Posted: 27 Aug 2020 10:44 AM PDT Yes, I realize up front that this is a little silly, and that there is a great deal of vanity in the issue. Maybe a little of this is just looking to vent/whine, but I also think there are questions and issues that come out of this to be discussed for people who are FIRE or at least FI. I just crossed a personal milestone for net worth ($3 mil. U.S.). Thank you stock market. But there is part of me that is excited, and when I'm excited about that, I naturally want to tell friends, etc. But this is obviously a bad idea. First, because it's just kind of considered rude/gauche (and I understand why). Second, because obviously people may feel badly/be jealous. Third, because it is the type of information that can change how people look at you, and once you've told, you can't make people unlearn it (or necessarily stop it from spreading). That said, I do find it hard to not talk to people about it. I even have some friends who are high earners themselves, who while they might be a little jealous (they have college expenses for kids, etc. that I do not that keep them from saving quite as much), would probably understand. But I keep having to tell myself that personal finances, even personal victories, are something best kept quietly to yourself. Anyone else deal with these conflicting feelings (who is willing to share, and discuss their own thoughts)? P.S. Yes, I am aware that this post in itself is a little bit of sharing my own circumstances. Forgive me. :) But I am honestly curious how others deal with it. EDIT: I see some posts here that lead me to think I might not have been clear enough about when I want to disclose. I'm certainly not talking about just hitting up some random guy in the office (or really, anyone in the office) with my net worth. Or certainly anyone that I think might be struggling, etc. I'm really talking more about my girlfriend/significant other (we've only been together for two years, and while it is very serious, she does not know what I have exactly), mother, and a very close friend or two (one of whom is a CFO and makes damn good money himself). It's really more of a pride/sharing with friends/celebratory type of thing. But again, I get why it's tacky - that's why I admit it's a personal weakness to want to do it. Just wanted to be clear that I don't have the desire to hit up some dude in the church parking lot with, "You know how much money I have?" :) [link] [comments]  |
| What’s it like to be rich/wealthy? Posted: 27 Aug 2020 03:58 PM PDT Hi. (27F) I come from a super poor family of immigrants, first gen American trying to make my American dreams come true. My goal is to one day be financially free so that I don't have to worry about food, housing etc .. but it got me thinking, what is it really like to be pretty wealthy? How does it feel? What does your day look like? Are you happy? Do you believe being wealthy has brought happiness to your life? Are there downsides? Thanks in advance [link] [comments]  |
| FIREd and could really use some advice on a withdrawal strategy: which funds to withdraw from first? Posted: 27 Aug 2020 03:57 PM PDT I FIREd as a result of a sudden sale of my business and thus didn't have much time to plan for a withdrawal strategy. I could really use some advice for which funds to withdraw from first, or what has worked for you personally? My current asset allocation is pretty straightforward: VTSAX (50%) VTIAX (10%) VBTLX (30%) VTABX (10%) - all in taxable brokerage acc. Plus 3 years' worth of expenses in a HYSA due to uncertain times these days. What would be your recommended withdrawal strategy for the next 5 years? Would you recommend shuffling the allocation in any way? [link] [comments]  |
| Hit My First Milestone at 25 as an H1-B Worker - Net Worth Equal to My Salary Posted: 27 Aug 2020 02:16 PM PDT I came to the states when I was 12. I was on an F-2 Visa, a dependent of a student. My mom came to the states as a student to study English. I graduated from a decent high-school and went to a public university with my own F-1 Visa. I was extremely lucky and my parents were able to pay for my school. I worked part-time on-campus as a IT Tech for three years, but it was only enough to cover my rent and save up enough to buy a used 2003 hatchback after graduation and fix it up. I currently make approximately $51,000 a year. I have a bachelor's degree in Computer Engineering and I work for the state university that I graduated from as a Software Developer. I know I could be making a lot more money out in the industry, but the quality of life, visa status, work life balance, benefits, job stability, access to a 457(b) plan, and a pension makes this job quite a bit better for my circumstances. I'm an H1-B visa holder. I'm from a different country and am here on a work visa. I'm in the beginning stages of the Green Card process, and am also pursing a Masters in Computer Engineering. I get in-state tuition rate as a staff and some tuition assistance for my degree as long as I maintain a certain GPA. I work partially Software Dev and also work as a Project Manager in many projects and will be pursuing a PMP certification in the near future and maybe an MBA after a few more years of work. I've always been more frugal than most, but I got into the state of "I have enough money, of course I can get that for myself". For the first 18 months after I got the job, I never held a credit card balance, I biked to work, ate lunch at home, etc: the usual frugal stuff without a strict budget. But I wasn't saving consciously. I then stumbled upon some FIRE related articles and started reading more about it. I was contributing to the mandatory pension, but wasn't putting anything away separately, because I wasn't sure if I would be able to stay in the states. I was afraid that I would have to go back to my home country and worry about money that's tied in a retirement account in the states that I can't take out without severe tax penalties until my 60's. When I learned about the 457(b) plan, that changed and I started maxing it out. 457(b) allows all contributions and earnings to be taken out when the employee leaves the institution without the early withdrawal penalty. I'll still be taxed, but only regular income tax. I can also roll the funds over to an applicable 401k or 403(b). The 457(b) has VIIIX Vanguard index fund with very low fee structure, so it's a great platform for me. Below is a quick breakdown of my monthly spending and monthly savings, but let me explain some of the items first. I sold my car in March, so the transportation savings is for future Uber rides or future car rentals. I also started saving monthly for gift obligations because there are a few co-workers getting married soon-ish and I need to buy them gifts! I found that saving monthly for them is easier. I also live with 2 other people, therefore my rent and utilities are low. I also picked a smaller place with lower rent, but close proximity to work. I refused to pay for parking at work(that's how it works at universities), so I biked to work before COVID. I have a significant amount going to my travel savings because I'm in a long distance relationship with my Fiancee. We can't travel now, but $200 - $300 per month savings usually covers our once every 2-3 month meetups. I still spend a lot every month on hobbies relative to my take-home, but if any other items in the budget go up, it's the first thing I cut. I have $1,000 sitting on my checking account so I don't have to dig into my emergency fund for routine things like having an small emergency expense or having higher utilities in a certain month due to high temps. It works the same way as the emergency fund, but I don't have to keep taking out of a savings account. $1,000 is also a nice number to look at in the checking account. The most I've gone into it was when my credit card was hacked and had to use my debit card for a few weeks. I'm glad it was there in checking, not savings where it would have taken a few days for transfer. I put away $19,500 pre-tax to 457(b), $4,500 pre-tax to pension, and $6,000 to Roth IRA per year. I take home around $1,830 per month after health insurance, dental, vision, life, FICA, etc. Monthly Budget: Monthly Income after Taxes = $1,830 Spendings: Rent, Internet, phone & Utilities = $450 - 500 Groceries = $120 Restaurants = $30 Hobbies = $200 Renter's Insurance = $14 Savings: Travel = $200 Grad School Tuition = $250 Roth IRA = $500 Transportation = $25 Gift Obligations = $25 Savings: Cushion in Checking Account = $1,000 Emergency Fund = $8,000 New Car Fund = $9,000 Wedding Fund = $5,000 Transportation Fund = $75 Graduate School Fund = $170 Taxable Investments = $2,400 457(b) = $9,500 Roth IRA = $8,600 Pension = $9,400 The Second Milestone of FI for me is Green Card & Marriage. Green Card will allow me to find additional work and streams of income(from hobbies or random jobs), and marriage will provide greater tax benefits, additional income, stability, and time with my lovely future wife! She's not quite on board with RE part of FIRE, but she's on board with FI! My goal is to hit Barista FI around 35 with $1M, then start pursuing hobby related careers. I love cycling, musical instruments, fishing, etc. I just want the ability to work less hours per week, do what I love, and maybe spend time with my future family. I think my fiancee is perfectly happy with working, so we may actually be able to achieve barista FI sooner. I made this post because a lot of the advice for FIRE assumes US residence and citizenship. I felt a little lost when everything pointed me towards 401k, because my university doesn't have a 401k. And everyone glossed over the penalties of taking money out early. I hope this helps anyone in similar circumstances. This post also helped me acknowledge that I've actually hit the first milestone. I realized it a few days ago and it wasn't really sinking in until I wrote this out. Onto the next! Feel free to ask me anything in the comments, or DM. [link] [comments]  |
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