Welcome to the first new blog post of the 2016 year – the annual edition of our plan for how to achieve financial independence and retire early (aka F.I.R.E.)! Every year at least once, I take everything I’ve learned about money to date about money management, tax strategies, etc., and then I use that information to improve our financial freedom plan; a creation you will often hear me refer to as my “money design”. Why do I do this? For both my benefit and yours, of course! Obviously I want to achieve financial independence for myself and my family. By finding new strategies and changing up my plan every year, I can make it so that I’ll be able to get there sooner or have more money available to cover my living expenses. My … [Read more...] about Our Plan for How to Achieve Financial Freedom – January 2016
Personal Finance
Average Retirement Savings Statistics – Really Scary Stuff!
Though there may not be a zombie apocalypse any time soon, there is one crisis that more and more people are starting to become concerned about: Saving for retirement. For almost 100 years when American Express established the first pension system in 1875, employers used to take care of their workers by making them contribute a small amount and then guaranteeing them income for life after they had given a certain number of years of service. However, over the past two decades, the burden and risk of preparing for retirement has shifted from employer to employee. Companies started offering 401(k) plans and doing away with pensions. What was once supposed to be a supplement, the 401(k) has now become the primary method (and … [Read more...] about Average Retirement Savings Statistics – Really Scary Stuff!
What is the Real Cost of Driving per Mile?
Talk to any of your friends at work or family members at a gathering, and someone is always sure to bring up “the price of gas” and how it is eating away at their monthly budget. Their complaints are totally justified! According to The Nest, transportation expenses count as the second biggest expense in U.S. households, running as much as 10 to 20% of the household income. Man, don’t I know the feeling! Car expenses have been a huge drain on our household for a long time. For well over a decade, I’ve commuted an exceptionally long distance to work every weekday: 60 miles each way, 120 miles round trip! Start adding up those numbers over the weeks, months, and years, and it’s no wonder I’ve easily gone through 3 different … [Read more...] about What is the Real Cost of Driving per Mile?
Should I Build My Rainy Day Savings Account or Save More for Retirement?
Every day, good intentioned couples are faced with a practical financial decision: Should we build back up our rainy day savings account or continue to save more for retirement? We just had this same dilemma in my own household. After having tapped our emergency fund for immediate cash to use a down payment on our new house, we’ve now got a big hole to fill. But that poses a financial problem. Every penny we earn that exceeds our budget is supposed to go towards our early retirement by age 45 plan. Plus, as we’ve demonstrated before here, saving your money in tax-sheltered accounts can compound into huge financial benefits later on. So then, why am I choosing to build back up my rainy day fund and put my extra retirement … [Read more...] about Should I Build My Rainy Day Savings Account or Save More for Retirement?
Should I Rollover My 401(k) Into an IRA? – Absolutely!
One of the biggest financial questions working people like you and I face when we change jobs is the question of should I rollover my 401(k) into an IRA or not? It’s a BIG decision, and not one to be taken lightly! The answer could result in missed opportunity of hundreds of thousands of dollars later on down the road. Or worse … make the wrong move and you could end up owing the IRS tens of thousands of dollars in taxes that you’re not prepared to pay for. Yikes!!! I was recently faced with this decision now that I’ve made some new life changes and decided to switch jobs. I’m not going to be shy – my 401(k) balance was pretty substantial! 12 years of saving and earning tons of employee matches results in a pretty healthy … [Read more...] about Should I Rollover My 401(k) Into an IRA? – Absolutely!
The Best Retirement Payout Calculator I’ve Ever Seen
I love playing around with online retirement calculators. But unfortunately most of them leave me disappointed. How many times have you plugged some numbers into one of those calculators only to receive some magical savings goal, and then said to yourself, okay … now what? It just leaves you hanging with so many un-answered questions! What happens if I really do hit that BIG number? Will life be all peaches? Will my money last me forever and ever? What if the market does really poorly? What’s the probability? Over time, how will my savings look then? What if that “magic number” the calculator spits out is too conservative, and I could do just fine by saving less money? What about Social Security? How will that affect my … [Read more...] about The Best Retirement Payout Calculator I’ve Ever Seen
Could Buying Your First House Be a Financial Mistake?
It’s official – we’ve moved! We’re finally all settled into our new house in our new city, and we’re loving every minute of it! This is only the second house my wife and I have purchased in our adult lives. Our first one was back when I was 24 years old. With our first house for sale on the market at almost the same price we paid for it back 11 years ago, this got me thinking: What if we hadn’t bought a house when we first got married, and did something else with our money? Would we be better off financially? Although this is a fun little question to ponder, it’s actually a very real and tough choice for lots of young working professionals today. Many of them are faced with the decision of whether to find a place to rent or … [Read more...] about Could Buying Your First House Be a Financial Mistake?
How to Use the Power of Customer Retention to Lower Your Bills
Me: So I get to add an extra line, get a brand new iPhone 6, and my monthly bill is going to be exactly the same? Sales Rep: Yes. Me: You’re sure? It’s not going to go up after a month or two? Sales Rep: Correct. Me: And we’re not getting any less service at this price? Sales Rep: Right. Oh, there is one thing … you’re also going to get this new Samsung tablet as part of the package. That’s already included in the price I quoted you. Shopping Around for a Cell Phone: That exchange of words above is exactly what happened just a few months ago when I started shopping around trying to lower my bills and find a cell phone for my daughter. Originally my wife and I were planning to get her an older, used one off … [Read more...] about How to Use the Power of Customer Retention to Lower Your Bills
