Financial Independence Daily FI discussion thread - Tuesday, November 30, 2021

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• Daily FI discussion thread - Tuesday, November 30, 2021
• Is it ever a good idea to disclose to employer you are FIRE to push for adjusted working conditions (eg. Remote)?
• Yesterday I asked you about book suggestions, here are the statistics and data...
• Various Financial and Investing Book Summaries
• Building generational wealth
• Separating From USN and idk what to do to min/max FIRE
• Highest paying jobs

Daily FI discussion thread - Tuesday, November 30, 2021 Posted: 30 Nov 2021 02:02 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. submitted by /u/AutoModerator [link] [comments]

Is it ever a good idea to disclose to employer you are FIRE to push for adjusted working conditions (eg. Remote)? Posted: 30 Nov 2021 01:00 PM PST I know many people here tend to FIRE quietly then go out with a bang by quitting suddenly. That was my plan too, but covid + remote made me realize my job isn't so bad provided that I can work remote and escape the office politics. My situation is that I'm borderline FIRE but would feel more comfortable working full time for another few years to top up the bucket. I'm really not looking forward to going back to the office and my ideal situation would be to continue remote work, then in a few years transition to part time/reduced hours or ask to have my hours cut in between projects. I think I would be pretty bored not working entirely, so having part time work with a bit of extra discretionary income doesn't sound too bad. The company is fairly conservative and would 100% push for a back to office mandate. As a bit of background, I'm 33, an engineer and on good terms with everyone at the company. I'm comfortable enough around my manager to be fully transparent about this to work out a real career plan, but of course you can never trust any corporation. Curious as to how to navigate the politics behind this. submitted by /u/turbo5vz [link] [comments]

Yesterday I asked you about book suggestions, here are the statistics and data... Posted: 30 Nov 2021 06:08 PM PST Yesterday I asked you about the best books that genuinely helped you financially. I was overwhelmed by the amount of awesome recommendations, but also by the number of books suggested. This is all based on the 409 comments received ​ To make it easier for those who have the same question as I had, I organized all the data received and split it into categories and rankings. ​ All data taken First I have the top 19 books suggested, along side the number of times they were mentioned and the amount of upvotes each received (accumulative) ​ Book title Number of Mentions Number of Upvotes Rich dad Poor Dad 26 262 The Millionaire Next Door 20 255 The Richest Man in Babylon 12 292 Your Money or Your Life 10 362 The Psychology of Money 7 560 Bogleheads Common Sense Guide to Investing 7 113 The Simple Path to Wealth 6 28 The Automatic Millionaire 5 26 I Will Teach You to Be Rich 4 58 Millionaire Teacher 3 166 The Little Book of Common Sense Investing 3 97 A Random Walk Down Wall Street 3 62 Quit like a millionaire 2 47 Die with Zero 1 132 The safe investor 1 42 How to win friends and influence people 1 34 Think and Grow Rich 1 32 Guide to Financial Independence 1 18 Loaded - Money, Psychology, and How to Get Ahead Without Leaving Your Values Behind 1 15 ​ Categorized by Number of Mentions ​ Rank: Book Title Number of Mentions 1 Rich Dad Poor Dad 26 2 The Millionaire Next Door 20 3 The Richest Man in Babylon 12 4 Your Money or Your Life 10 5 Bogleheads Common Sense Guide to Investing 7 6 The Psychology of Money 7 7 The Simple Path to Wealth 6 8 The Automatic Millionaire 5 9 I Will Teach You to Be Rich 4 10 The Little Book of Common Sense Investing 3 11 Millionaire Teacher 3 12 A Random Walk Down Wall Street 3 ​ Categorized by Number of Upvotes ​ ​ Rank: Book Title Upvotes 1 The Psychology of Money 560 2 Your Money or Your Life 362 3 The Richest Man in Babylon 292 4 Rich dad Poor Dad 262 5 The Millionaire Next Door 255 6 Millionaire Teacher 166 7 Die with Zero 132 8 Bogleheads Common Sense Guide to Investing 113 9 The Little Book of Common Sense Investing 97 10 A Random Walk Down Wall Street 62 ​ In conclusion, there are many amazing books out there and it's time for me to go reading now. Hopefully this list will help everyone discover new helpful books to expand their knowledge. submitted by /u/IDKwhatUserToPut [link] [comments]

Various Financial and Investing Book Summaries Posted: 30 Nov 2021 09:44 AM PST Like the title says, lots of book summaries on different topics. Mostly geared toward the passive index investor. Saw a post on r/bogleheads that said some people had come from here so here you go. Enjoy John Bogle The Little Book of Common-Sense Investing Buffet – Newtons 4th law of motion. Investor return decrease as motion increases. Winning Strategy for investing is to buy a fund that holds all market portfolio and hold it forever The index fund eliminates the risks of individual stocks, market sectors, and manager selection. Only stock market risk remains, which is large A traditional index fund operates with minimal expenses, no advisory fees, with tiny portfolio turnover, and high tax efficiency. Investing in equities long term is a winner's game The returns earned by business are ultimately translated into the stock market Active Investing is a zero-sum game, for every person that beats the market by 1% someone else lost by 1%. Mutual fund investors are confident they can easily select the right fund managers. They are WRONG When the stock temporarily overperforms or underperforms the business, a limited number of shareholders receive outsized benefits at the expense of those they trade with…. Over time, the aggregate gains made must of necessity match the business gains of the company The stock market returns must equal the business returns over a long period. But this goes up and down in cycles. As investors are willing to pay higher or lower P/E. Investment yield on stocks (dividends plus dividend earnings growth) tracks with the total market return. About 9.5% for the last 100 years Reversions to the mean – Tendency for P/E ratios to return to their long-term norms over time. Economics controls the long-term stock market return. Emotions control the short term. Accurately predicting short term emotions is impossible Occam's razor – when there are multiple solutions to a problem, choose the most simple Solution – buy and hold a diversified, low cost portfolio that tracks the stock market Investors as a group must earn precisely the market return, BEFORE THE COSTS OF INVESTING ARE DEDUCTED – when we subtract all the fees, turnover, taxes, commissions, sales loads, advertising, and legal fees – the returns of investors will fall short of the market by precisely those costs. The lower these costs the better Before costs, beating the market is a zero-sum game, after costs, it is a loser's game Focus on the lowest cost funds – the more managers take, the less investors make Don't invest in funds based on past performance. Performance comes and goes. But costs go on forever Costs Expense Ratio Sales Charge Purchase and sale of securities or turnover Assume the turnover costs equal 1% the turnover rate. IE - 100% turnover = 1%. 50% turnover = 0.5% Low cost funds beat high cost funds Most equity fund investors actually get lower returns than the funds they invest in.…. why? Counterproductive market timing and adverse fund selection. Most investors put money in as a fund is rising and pull money out as it is falling. Investors chase past performance. Actively managed funds are tax inefficient due to turnover Fund returns are devastated by costs, adverse fund section, bad timing, taxes and inflation Don't look for the needle, just buy the whole haystack 355 equity funds from 1970 to 2006 – 80% had gone out of business. Only 2 of the 355 funds had superior performance during this time (beat the index by 2%) 8 funds beat the index by 1%. The odds of you picking one of these funds is extremely low. As the active fund does better, it has more inflows of cash which makes it difficult to maintain that advantage. Picking a winner based on the past is hazardous duty Over the long-term stocks have provided higher returns than bonds, so why own bonds? Bonds have beat stocks in 42 of the last 112 years They reduce volatility in the portfolio Investors who seek to increase yields in their bonds by investing in junk bonds should be careful. If you are going to do it make it a very small percent of your portfolio. Long term bonds are much more volatile than short term Ben Graham – The average manager cannot obtain better results than the S+P 500. Investors should be content with earning the markets return. Only low-cost index investing can guarantee that outcome. Asset allocation accounts for 94% of return. 2 factors that determine how you should allocate your portfolio Ability to take risk – depends on financial position, liabilities, years. In general, you are able to take more risks the longer time horizon you have Willingness to take risk – matter of preference. Some investors can handle the up and downs. If you can't sleep at night, you have too much risk. These two factors determine your risk tolerance Rebalance portfolios at most once per year https://reddit.com/r/Bogleheads/comments/q6dxtd/_/hgcop3i/?context=1 submitted by /u/captmorgan50 [link] [comments]

Building generational wealth Posted: 30 Nov 2021 11:12 AM PST Much has been said about personal FIRE numbers, but what about going one step further and saving enough so that your children and possibly further descendants can also retire early? How much do you actually need for that? (tl;dr, it appears to be much less than you might think) I'm not looking to create generations of trust fund babies, but I would like my children to be able to also retire early-ish, even if they end up being less financially successful than me in their careers. To explore that, I started with a simplified model: say I just retired with a $1M portfolio, annual inflation is a steady 3% (close to the historical average) and portfolio return is 9% (also close to the historical average for a 60/40 portfolio). Under these conditions, I could withdraw 6% of my portfolio (i.e. an inflation-adjusted $60k) every year and never run out, leaving an inflation-adjusted $1M to be inherited by my children. So I don't have to keep prefixing things with "inflation-adjusted" everywhere, all numbers below are inflation-adjusted (essentially using a growth rate of 6%: 9% nominal growth minus 3% inflation). Assume I have 2 children, and I want each to inherit $1M when I die, same as I have now, and let's further assume that I expect to live another 30 years. Therefore I need to add enough money to my initial portfolio such that the additional amount grows to $1M in 30 years (since the original $1M will already stay at a steady $1M). An extra $175k is needed, which over 30 years will grow to $1M. I'm also assuming that when my children inherit their $1M each, they will just continue to pull $60k annually from that, so that they each will have $1M to leave to their children. For my grandchildren (assuming I'll have 4 who will receive this money in about 65 years), I could save another $45k, which over 65 years will grow to $2M, which combined with the $2M my children will be leaving them as an inheritance will give each of the grandchildren the same $1M. Similarly, 8 great-grandchildren requires another $15k or so. And that's assuming my great/grand/children don't have any savings of their own when they inherit. In reality they're not going to inherit this money until they've worked at least a few decades and hopefully accumulated at least some savings of their own. So all said and done, it appears that I only need to boost my retirement portfolio by 20-30% in order to set up all my descendants for early retirement, assuming they'll have similar expenses/lifestyle as I do. That seems surprisingly little, so my question to you is did I miss anything? Any major flaws in my logic? Is anyone else thinking of saving enough for their descendants to FIRE too? submitted by /u/probablysavedtoomuch [link] [comments]

Separating From USN and idk what to do to min/max FIRE Posted: 30 Nov 2021 10:26 PM PST Hi all, I am a young adult (mid - late 20's) that recently applied and got accepted for a DoD Skillbridge program which allowed me to operationally check-oit of the Navy 180 days early for an unpaid internship (Navy still pays me until I separate. I say this because I shot my shot and convinced an DoD engineering contractor that they needed an analyst and gave me a "6 month interview" (aka the unpaid internship was my proving ground) and I accepted a job offer. Where I am lost is thet for the Naxt 36 months I will be making $15,608 (~$188k yearly) every month (living expenses are only ~$3500 a month) tand it is from: VA disability MHA (G.I. Bill) Salary I have about 30k in debt that will be paid off first, but other than that I don't really know what to do, this is over three times what I make now. I want to get into passive income but idk where to start other than real estate. Any advice is welcome. I am posting on my alt account as I don't want to be identified. submitted by /u/USN_CTR1 [link] [comments]

Highest paying jobs Posted: 30 Nov 2021 10:15 PM PST career path that's high paying with little to no college classes but I know I'm most likely going to need to take some college. $100,000+ a year submitted by /u/Express_Arugula387 [link] [comments]

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