Financial Independence Daily FI discussion thread - Saturday, January 02, 2021 |
- Daily FI discussion thread - Saturday, January 02, 2021
- From 10k to 955k in 7.5 Years (with Graph)
- Stressed about following FIRE
- [OC] A Summary of Year 2 of my Journey as a Swede Looking to FIRE [Graphs]
- Why I don’t want to FIRE as soon as possible.
| Daily FI discussion thread - Saturday, January 02, 2021 Posted: 02 Jan 2021 04:00 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]  |
| From 10k to 955k in 7.5 Years (with Graph) Posted: 01 Jan 2021 05:29 PM PST This is the my third year following up on the 2019 and 2018 financial review posts. Honestly, not much has happened this year with the pandemic. My wife and 1.5 year old toddler basically stayed (and attempted to work) at home since March. Spending is pretty darn low (about 36% of our income) but we've been cooking some amazing meals. Missed some awesome vacations and have pretty much settled into a "I never want to step into an office again" mindset. This graph starts 6 months after graduating college when I had already accumulated 30k and ends on...well today(ish). This graph is for two people, not just me as of July 2015 Since the last updated I've:
Some answers to common questions are below:
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| Posted: 02 Jan 2021 03:56 PM PST January 2020 i had $6000. January 2021 i have $18,000 net worth. Somehow I'm stressing out more than people who are 50, no savings, and 3 kids, a spouse and mortgage. I have no kids, girlfriend, no rent since moving back in with parents. I'm 28 and I am stressed out thinking I should be a millionaire by now. That I cant date or start a family without having enough money nkt worry about things like a house or an medical bill. Thoughts? [link] [comments]  |
| [OC] A Summary of Year 2 of my Journey as a Swede Looking to FIRE [Graphs] Posted: 02 Jan 2021 02:01 AM PST In March 2019 I got exposed to the idea of FIRE and was hooked right away. I compiled a few graphs of data from the second of my FIRE journey. Even though the dollar has taken a hit compared to the swedish krona (lost about 20% of value) I still decided to convert all the numbers from SEK to USD with a 10/1 conversion rate. All income is post taxes, I hope you enjoy. Link to the Graphs over at r/dataisbeautiful Background: I am a 27 year old Swede and in March 2019 I saw a friend post Mr. Money Mustache's shockingly simple math behind early retirement. And somehow it didn't seem like an impossible goal, it actually seemed quite obtainable. Initially I aimed at building a portfolio that could support me going down to work 50% by the time I have kids so that I can be there for them when they need it the most, but as the year went on I realised I was making good progress so I raised my ambitions and am now looking for a total early retirement instead. The goal is to retire sometime around 2033-2035 when I'm in my early forties. I've worked part time during most of my adulthood to enable me to train and compete in sports on a high level. But an injury forced me to "retire early" in another sense from the sport. So since last year I now have a full time employment I have a side hustle in photography where I recently am starting to make some extra money as well and have opened a business for. At the end of 2020 I also expanded a bit and now have a regular assignment in the same field where I will be working part time (50%) . My business's economy is separated from my "personal finances". I can buy electronics and trips through my business and I won't count any of my business income in these numbers unless I've specifically moved them from my business account to my private account. Quartely Breakdown Q1 - Got a large cash infusion from a big side hustle project in December which was nice. I remember mentioning in a comment last year that I didn't feel like I needed more than $1000-2000 because the most financially impacting expense for me would be that I would move houses, and I didn't see that happening anytime soon. Well not short after I moved. And then I moved again six months later. So it was a good thing I had some extra cash coming in. SR at 54% for the quarter. Q2 - More or less a normal quarter, bussiness as usual that let me log a nice SR of 58% for the quarter. Due to some financial rules following me getting employed full time I did not get my vacation bonus lump sum I got last year. I will however get both that and PTO in 2021. Q3 - Moved again. Managed to keep the cost down pretty well and bought most furniture second hand and from IKEA (Go Sweden). Also went on a (covid safe) vacation in Sweden for the summer month. It was actually the first time in my life that I had a paid vacation since last year was the first time I started working full time. Very nice. Solid income this quarter too but SR got dragged down from moving costs and landed at 46% Q4 - Another normal quarter expense wise. The rent at the new place is about 60% higher due to it being in an even better location and also being bigger. This this quarter I started a new type of job in my side hustle that will be a regular occurance for the forseeable future. It will allow me to add about $1K to my long term savings each month. Very nice. Savings rate ended up at 67% for the quarter and 56% for the year. A look at the Expenses Rent - Looking at expenses, rent and utilities is hands down the biggest contributor. I now live with my girlfriend in a 2 room and kitchen apartment at about 50m2. The rent is higher than I would like it to be but the location and apartment is great. I live in central Stockholm. Food - Other than rent, food was the biggest post. I'm doing my best to make as much food as possible at home and only buy out when I really want to. Another prominent Swede in the fire community came up with the saying that restaurants don't sell food, they sell an experience. This is a good way to think about buying out and not taking it for granted. Food cost this year was down a little bit compared to last year, yay! Travel - Travel cost were not too bad this year. Only did the covid safe Sweden vacation for two weeks which wasn't too expensive. Phone - Last year I made the final payments on my phone in Q3 and I still have a relatively cheap plan for unlimited data. I put in a new battery and will still aim to keep this phone (iPhone 8+) until it dies. Entertainment - I spent less here than last year. I tried golfing a few times (pretty expensive) and bought some video games. I also put haircuts in this category even though it probably shouldn't be. I don't spend much in this category. If I need to upgrade my computer or other hardware most of the cases I can pay for it through my business/side hustle and have it as a business expense. Clothing - This year I set a goal for myself that I would not buy any clothes. I managed to complete this goal, yay! Gym Membership - Last year I said, "This one is a bit on the high end so I need to really evaluate it this year and make sure I go there enough to warrant keeping the expense." This year was a bit weird so I didn't visit as much as I'd have liked. Was able to freeze the membership for end of this year and beginning of the next. We will see when I can establish a normal baseline here again. It was an easier cost to motivate when I was training at an elite level. Health Care - Bought some allergy meds and started seeing a physical therapist to take care of the issue that caused me to retire from sports. UIF - This is a cheap insurance to make sure I still get 80% of my current income should I lose my job for whatever reason. The cost of this was raised this summer following covid. I might see if I can find another UIF at a better price now. Subscriptions - My Spotify account. Transport - Until the beginning of summer I was commuting with busses and trains but for the rest of the year I've been riding my scooter everywhere. Thanks to mild temperatures I could ride it throughout december. I had to spend some money getting spare parts to fix up some issues with the moped. Buffer/short term savings - I dropped this to be at $1000 and have been able to keep it there. I don't know what could possibly happen that would require me to have to deplete all of that amount of money now that I've moved twice and have furniture coming out my ass. In 2021 I will also expand this sort of, by saving for trips and other fun stuff. So there will be a sort of goal/target/short term saving aside from emergency savings/buffer. Income The majority of my income is from my job, that is now a full time job. Some months I do a bit of overtime and I don't use up all my vacation days (the days not used then becomes a lump sum payment next year). I also got a boost from my side hustle. Especially now that I have a regular half time assignemnt. If there are fun photo projects that pay well I'll try to do those too, but I'm reaching the end of my time and capacity now with the amount of work I do now. I have a pretty normal job that requires no formal education. I don't work as an engineer or software developer ;) Saving Strategy This year I'm looking to invest at least $2500 per month. Last year that target ended up at $1500 after the initial goal at $1000. My stock portfolio consists of about 80% stock funds and 20% individual stocks. I want to keep the stock percentage relatively low so I don't make any large bad investments but I still find it very interesting and educational to have some stocks so that I can understand more of the market as a whole. So far I've outperformed the index. Let me know if you have any questions, thoughts or opinions! [link] [comments]  |
| Why I don’t want to FIRE as soon as possible. Posted: 01 Jan 2021 04:28 PM PST Like many, when I first discovered FIRE I was consumed - I started tracking my spending, budgeting, researching investments and attempting to increase my income. Naturally, to begin I read and researched a lot, there was a lot to learn. I made some meaningful strides, and now have everything set in place, all I need to do is continue to save and invest and I'll FIRE in 10 or so years. But I have continued to read, to research, to plan, to analyse, to overthink. This is not necessarily a bad thing but now I feel FIRE may be becoming too much of a focus - I'm too fixated on achieving FIRE above all else - and I think that will make me less happy. Don't get me wrong, I feel very lucky to have found the FIRE movement and to be able to confidently say I'll be financially independent one day. What a gift that is in a world where most people constantly stress about money and are unsure if they will be able to retire. My issue is feeling consumed by FIRE. Recently I found myself entertaining and working towards pursuing a career that will make me more money but would make me miserable (law). I started thinking yes I won't like the work, it'll be a tough corporate grind, but I'll make more money and could FIRE faster so it's worth it. I started putting FIRE as my number one objective and everything else, including happiness was secondary. This, in my opinion is the wrong way to think. I don't want FIRE to be all about the destination, I want to enjoy the journey. I don't want to work everyday until I'm 40 just to leave the workforce and say now I can start living. I want to go on long adventurous holidays, enjoy the work that I do, volunteer, spend my weekends with friends, focus on hobbies that make me happy - even though these things will slow down my path to FIRE. I don't mind if I achieve FIRE 5 years later than I could have if I've enjoyed the journey twice as much along the way. Just something to think about. TLDR; achieving FIRE asap may be harmful to your long term happiness. You should enjoy the journey and not just the destination. Maybe consider doing some more fun stuff along the way 😊 [link] [comments]  |
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