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So a bunch of wussies in some other thread were daring each other to make this thread, and I beat them to it. This thread is about Financial Independence, early retirement, or whatever else you like to call it. The basic principle, as espoused by such blogs as Mr. Money Moustache and Early Retirement Extreme is that saving/investing a huge percentage of your yearly income will eventually gain you yearly returns large enough to live off. A simple example may be this: say you earn $100,000 a year, but only really need to live off $30,000 a year, you can invest $70,000 per year at a 7% return, and a crude calculation approximates retirement (ie, yearly returns of $30,000) in... 6.1 years. Can it be this easy? No. Firstly, this simple calculation doesn't take into account taxes, inflation, where the hell do you get a consistent 7% return, withdrawal rate post-retirement and a thousand other problems. But the basic idea should be very interesting to anyone with a decent income, half a brain, and the desire for more free time. Calculators that you may find interesting are FireCalc and maybe this one. See also a great blog post by Mr. Money Moustache entitled "The Shockingly Simple Math Behind Early Retirement". EDIT: Removed barely relevant personal info discussion. Here's a heavily biased glossary and a list of links you may find relevant: Important Terminology FIRE - Financially Independent, Retired Early. As in "When I'm FIRE, you better believe I'm going to learn guitar." Generally it means that this person has collected enough savings that they can withdraw enough money to live off each year and never run out of money. Or run out of money precisely when they plan to die. You can split up the acronym, so FI means just financially independent without necessarily having ceased a working life, RE is retir[ing/ed] early. SWR - Safe Withdrawal Rate. Usually given as a percentage, usually 4% or less. This is the amount of the total portfolio which an individual has calculated they can withdraw each year and still have a 'safe' (95%+) chance of the portfolio lasting the expected timeframe. The origin of the 4% figure is the Trinity study. Also used just as 'WR' (Withdrawal Rate), also given as a percentage, which is just the percent of the total portfolio which the person is going to withdraw per year in retirement. SR - Savings Rate. Usually given as a percentage, the amount of their total income which a person is able to invest each year. At savings rates above 50% magical financial things start happening in your future. 'Stache or Stash or NW (networth)- The pile of money/total portfolio value that a person is currently sitting on. The 'Stache' is a Mr. Money Mustache reference. YMOYL - A book called Your Money or Your Life. I take it that in a time before blogs this was many peoples' entrance point into the concept of financial independence. Never read it, myself. Side Hustle - A cool name for a small business that makes you sound cool and motivated and edgy. Usually done in your spare time, otherwise you'd just be 'self-employed' and gosh that sounds boring. Index Funds/Passive Investing - The easiest, safest* and surest way for anyone to invest their money, index funds buy all the companies in a tracked index (e.g. the S&P500) in proportion to their market capital. Every dollar you invest is split across the entire range of companies, and most comprehensive indexes are positive over long enough timespans to the order of 7% per year or thereabouts. If this paragraph was the only thing you read about investing in your entire life, and you subsequently went out and bought into one or more of Vanguard's main index funds, you would outperform most other investors. Sounds almost unfair, that such inexperience could outperform people who dedicate their entire lives and billions of dollars into beating the market - but the historical evidence doesn't lie. I think it's safe to say that most FIRE advocates are fully or mostly invested in index funds, with a small number instead preferring.. Dividend Investing - Some companies pay out profits to their investors in the form of dividend payments. Some companies have historically been very reliable in making and increasing these dividend payments. Some FIRE investors prefer the idea of receiving enough cash flow in the form of dividend payments to cover their expenses rather than having to sell of portions of their assets each year. Requires a lot more knowledge, time and active investment than the indexing approach. The overall performance of such a portfolio versus an entirely index approach may also be questionable but simply the time and knowledge investment required is enough to deter most people. Including me. Active Investing - Basically what most ordinary people think the 'stock market' is. Buying low, selling high and all that bullshit. Seriously, only morons would actively invest with more than a small fraction of their portfolio. All the success stories you hear, even the success stories you are currently living, are mathematical outliers and survivor bias. Unless you have some insider information, in which case you're breaking the law. Blogs Mr. Money Mustache - The big fish in the pond. He and his partner retired in their 30's many years before starting the blog, which now earns them $400K+ per year. Don't hold it against them though, they still spend less than $25,000 of it to survive. His back catalogue of posts is fantastic and truly inspiring, and he has been instrumental in popularising his unique brand of frugality, stoicism and SUV owner insulting which has become known as 'Mustachianism'. The forums there are huge and well worth a visit. Recently his posts have been a little uninspired and tend towards product endorsements. Early Retirement Extreme - Jacob retired on just over $200K to live in a van down by the river. He wrote a book which is incredibly dense and incredibly good, with many complicated graphs, fractions and formulas definitively proving once and for all that you are spending too much money. His blog was the best source for information and motivation before Mr. Money Mustache came along, and Jacob has officially 'passed the torch'. He no longer updates the blog (it cycles through old articles) and has returned to work, but don't let the Internet Retirement Police tell you that this means he isn't FIRE. Go Curry Cracker - These guys have been pretty popular lately. They're young, they're relatable, they have over a million dollars invested. They travel around the world having babies. Mad FIentist - He's FI but still working, his wife is not FI and is also still working. He makes a good, sporadically updated podcast in which he interviews well-known bloggers in the industry. Radical Personal Finance - If you need a podcast which is regularly updated, then this is your guy. Personally I find he drones on so much that I end up literally screaming and pleading for him to get to the point, but he has some good interviews and a huge variety of ideas are explored. There's only so much you can say on the topic though, before it just gets repetitive. Also his content is mainly only relevant to US citizens. Living A FI - Apparently Dr. Doom has recently become financially independent. Some interesting insights into a newly retired supervillian. Dividend Mantra - One of the more outspoken advocates of the dividend investing approach. Rockstar Finance - JMoney trawls the depths of personal finance blogs and brings you his top three choices, daily. * Safe over the long-term. Short and medium-term volatility (ups and downs) apply to most index funds. Chadzok fucked around with this message at 05:06 on May 6, 2016 |
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Jul 17, 2013 11:08
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enraged_camel posted:It's hard to say without knowing exactly what the main job and the side job is and how exactly they are related. You say the main job is helps with profit margins - what do you mean? Could you quit it and still have the same level of income from the side job? I'm a coffee professional, fix machines, deliver coffee and generally hang out at cafes all week drinking mad ristrettos. The side job is a markets-based coffee stall. I get cheap(er) stock (eg coffee/chocolate etc) from my company, and I can use the company vehicle so I can essentially cut out vehicular expenses while I'm working there. The markets are on the weekends (5 days a month). I'm unsure exactly how leaving the job would affect my stall profits - it would definitely impact it but I'd still be making plenty of money. I'm currently in month 3 of a year-long process tracking incomings/outgoings to figure out exactly what the side business makes and costs. Sundae posted:Two other questions about your side job: Hmm.. 1) Yes, it's reliable, although it is weather dependent. I tend to plan by 'averaged' earnings which take into account terrible days and abnormally good days. 2) Yes. I could also do larger/longer festivals with potentially higher earnings (although more risk) which I can't currently due to employment. 3) I don't currently have private health insurance and my job provides no benefit in this respect other than increasing income in order to afford it more easily. I've definitely considered expanding the stalls to other markets/festivals. I know some people that treat it like a job and go to five markets a week. God knows how much they're making. It's much harder to get into markets with coffee though, most of them have an established one already. We got into ours through a business partnership and another because the opposition was an rear end in a top hat who made poo poo coffee. Chadzok fucked around with this message at 14:05 on Jul 17, 2013 |
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Jul 17, 2013 13:56
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tuyop posted:Holy poo poo I want this side gig. Can you cook? Or can you pay people to cook for you? Print a banner, buy a barbeque and a tent, and apply at any local markets and festivals. Most of my mates in the 'industry' live off their food stalls. Coffee stalls don't make quite as much money, but they're less risk (less perishable stock) and less work. Chadzok fucked around with this message at 14:06 on Jul 17, 2013 |
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Jul 17, 2013 14:01
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Ignoranceisbliss88 posted:Question is, what the hell do you do with your time once you're retired at 30. Countless studies point out that working into your later years can keep you mentally sharp and even extend your life. Everyone thinks it'd be great to not have to go to work, but careers can be major motivators for people in life. Once I leave my job I have a few businesses that I'd like to pursue (sure I could do them now, but not relying on them for my income would be awesome), there is a heck of a lot of travelling that I want to do (locally and overseas), have kids and actually spend time with them, education that I'd like to pursue but not for income purposes.. The point is, you're welcome to keep working if you like (the more you invest, the higher your base standard of living can be, if you want to look at it that way), and most people who've already 'retired' seem to keep working at least part-time. This is not about racing as fast as you can to sitting on your rear end all day. It's about financial awareness, conscious long-term financial decision making, and empowering yourself with a base income that does not rely on someone else's willingness to employ you. Even if you don't want to retire early, how many people have actually sat down and calculated their own retirement requirements? (possibly much higher than average in this forum) Cicero posted:We're talking about early retirement, though. A lot of people (well, the ones with high-paying jobs anyway) aim to be financially independent in, like, a decade from when they start saving. Just to be clear, I am not highly paid in my full-time job. Actually, I make the exact current Australian median wage. I've pursued my side gig as a way of accelerating my own income in order to become financially independent sooner. So I don't just think this concept is for highly paid people. I'm aware you didn't say that, but I just want lurkers to be clear. Chadzok fucked around with this message at 00:19 on Jul 18, 2013 |
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Jul 18, 2013 00:14
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moana posted:Using the chart in the "shockingly simple math" article, I'm on track to retire in 10 years. That sounds great to me Here, have another MMM blogpost. The basic message being that after early retirement it is possible and desirable to maintain a positive savings regime, if significantly lower than during the main savings years. The effect being that your net worth compounds and grows, rather than stagnating or slowly shrinking. Using myself as an example, when I've saved enough necessary to deem it safe to 'retire', I will maintain my side income (because it's fun and and an essential part of my social life) and possibly add others, and I'm quite sure that I'll still be adding a few hundred a month (at the very least) to the stash. Would this be enough to cover all eventualities? Who knows. But then again, I could get struck by blue ice on the way the the gym tomorrow, but I'm not going to let that stop me from reaching my fitness goals.
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Jul 18, 2013 09:07
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But it also doesn't take into account major life changes like having kids - what if I have a special needs child? What if my spouse becomes disabled and I need to support them? I'd hate to "retire" at 40 and at 50 have to get back into the workplace if something bad happened to a family member. How can you even begin to account for such things?
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tuyop, I love that sentiment. gently caress perfect, you can't possibly account for every eventuality. Just wanted to share a simple example of frugality and long-term thinking from my weekend. Normally we get home after a hard Saturday's work and we're both so exhausted that we just get takeout, for about $25. This time, however, I did a quick calculation and realised we were spending $1300 a year on this stubborn little ritual. With this realisation, we got off our frugal little butts and made a delicious chicken salad with ingredients available in our fridge. If I can work out how to save $25 a week, and then figure out how to earn $25 more per week, I've got an extra $2600 a year to play around with. Neither of those are particularly hard things to do, and it strikes me as an incredibly entertaining challenge to carry out every so often. I've already saved $25, so to earn a $25 on top of that, I'm going to make a new product display for my stall that I've been meaning to do for a while. Investment Question I think I'm ready to hand over some cash to a Vanguard Index Fund. Anyone with experience here, how does this fit into your portfolio? What percentage of your total investments do you place here? do they give regular 'dividends' or is it more like a bank account that accrues interest? This is a long-term investment, right? I shouldn't expect 7% returns my first month, but over the long-run (5-10 yrs) it should be that or higher? Is it better to put weekly deposits or irregular lump sums? Total newb, just want to make sure I understand it all correctly.
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Jul 21, 2013 10:06
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I find it hard to imagine that if you get along at all you can't both be jointly motivated by a similar goal, especially one which is so awesome. My lady always rolls her eyes at my cripplingly large frugality muscles - I'll practically have steam coming out my ears when she buys a set of glasses because goddamnit WE ALREADY HAVE THINGS TO DRINK OUT OF. But when I talk about the goals we're kicking and the future we've got coming I see the same light in her eyes. Have you tried having a serious conversation with her about it? With two people attacking (especially when one is 3 times higher!) your goals will be a hell of a lot more achievable. Unless she seriously loves her job or something. But even then, there is an inherent 'jobiness' to work that means you're getting the short end of the stick financially speaking.
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Oct 24, 2013 08:25
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razz posted:That begs a different question - is financial independence possible for people who aren't big earners and probably never will be? A couple of thoughts here: Firstly, as the poster above mentioned, increase income with side gigs. There are way too many different ways of making money to list here, but using our household and skill sets as an example - coffee market/event stalls, coffee machine rental, candle making, soap making. Be imaginative and entrepreneurial with the skills that you possess. A microbusiness that costs you a couple hundred bucks or less to start can bring in stunning amounts of money. Secondly, you could approach the other side of the coin, reducing costs, possibly in radical ways. Buy an RV like ERE write Jacob Fisker and watch your living costs dwindle to barely anything. Thirdly, leverage anything you can get for free on a regular basis. My job involves visiting a number of cafés who often offer me free food. I never, ever turn them down. They get a kick out of generosity, and I pay for one less meal this week. I've also got a weekly bread run to a bakery who tosses their (perfectly fine) leftover loaves at close of business. The answer is definitely yes, though. Just requires a lot more creative thinking. It's part of the fun for me, I couldn't handle the grind of a high-paying mindless job (I have briefly held such a position), I much prefer being forced to think outside the cubicle.
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Nov 6, 2013 23:32
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Folly posted:
About how much do these things cost on first arrival? I ask for a friend who sleeps in my bed and is beginning to make demands. 2014's set to be a good year for us. The side gig is still powering along and kicking goals, I decided to stick with my job for the time being so that's going well also. My entrepreneurial mate is also undertaking another new little hobby business this year making soaps, so hoping that will also add stashing power. I'm dipping my toe into 'dividend growth investment' this year, it appears to be the best solution to my long-term finances, especially with Australia's franking credits system. I'll attempt to explain more if anyone is interested. The only problem is I check my excel spreadsheets way too often. This whole thing is definitely a marathon, rather than the sprint I was considering taking last year (leaving the job and living off the business). Oh, and I recently actually read through Jacob's whole book (Early Retirement Extreme) - the guy is a massive brain, it's hugely entertaining to read him focusing all his neuronal power at being frugal in a wasteful world. It definitely flipped some switches in my head. Without even trying to, I appraise everything I think about purchasing and I'm more considering in the way I approach problems. It's massively simple to make your own flyspray, to take a small example. It's a hell of a lot more fun actually making solutions instead of buying them. Lots of other takeaways, highly recommended read.
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Jan 25, 2014 09:56
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tuyop posted:I hate that they like Give Directly, but their rationale is sound so I gave money to Give Directly. Give Directly rule. Science + Charity = Win.
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May 9, 2014 10:30
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froglet posted:A question about financial independence, I've only had a full time job for a few years, should I prioritise saving to buy a flat closer to my work over buying into ETF's or mutual funds? Here in Australia there's a scheme to encourage potential first home buyers to save by giving a 17% match on the first $6000 you put into the account. I started one last year, but I'm wondering if I should continue putting money into it or if I should have my assets more liquid since you can't take the money out once it's in. Just a bit of a different way of looking at this, I make the maximum contribution I can to both mine and my partner's first home saver accounts each year - even though I have no current intention of buying property - purely because it is 'free money' that is otherwise left on the table. With the co-contribution and the account interest it's a guaranteed >20% return every year on $12000. You won't beat that anywhere. If you don't end up using it, you can dump it into your super. I guess it depends on what other sort of investments you have. For me, it's the first thing I do each financial year to get it out of the way, but I consider it part of my 'old man money' rather than my FI funds. Chadzok fucked around with this message at 07:00 on May 14, 2014 |
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May 14, 2014 06:57
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Hey! Guess what! Ignore me, because our loving government just scrapped the whole idea! On the bright side, they will be removing restrictions on accessing the money, so I just got quick access to a whole bunch of old man money. I guess that's pretty cool.
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May 14, 2014 07:19
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Suspicious Lump posted:This is from pages ago, what's your stall about? Sorry lump, haven't been checking my own thread lately. I talked about it in the first couple of pages, but it's a market stall doing mainly coffee, with some pancakes, chai and other random things that work well. My latest addition is little baby banana breads, people freak about how cute they are and for an hours work on a friday night I'm earning an extra 100-150 bucks a week. EDIT: Be happy to change the thread title, have no idea how to. Editing the OP doesn't let me change thread title. Chadzok fucked around with this message at 11:55 on Dec 5, 2014 |
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Dec 5, 2014 11:51
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I'm not going to lie, it's pretty loving sweet. It's a lot of hard work, especially on top of a full time job, but the monetary rewards are more than motivating enough. The hardest part was the first 6-8 months, we were probably making money still but it felt like everything we had was going into building the business. If I had to start something from scratch now with the knowledge I've gained the last couple years, I would go to all my local successful farmers markets, write a list of all the stalls that are at each of them, and look for gaps. If there's a cane juice stall at three of them but not at the fourth, I'd apply as a cane juice stall/talk to the market managers and buy the equipment if accepted. Market stalls that do well: (you'd be shocked at how much money some of these people are making) Coffee, obviously Lemonade/ Cane juice/ Smoothies or any combination of the three (if your local area has never heard of cane juice I would get into this right now. Wish I'd jumped on it years ago.) Women's fashion (buy dresses wholesale, preferably from a non-local source so it's something a bit different to what's around) Most food stalls with attractive signage or unique products from a random ethnicity (more stringent OH&S requirements but honestly it's not hard to meet them) Turkish gozleme (must have awful signage and access to community of elderly Turkish women) Running the actual markets themselves (someone I know is trying this, I will keep you updated) Handmade jewellery Funny t-shirts Crystals and oogie boogie bullshit stuff Handmade crafts (soaps, candles, chopping boards, bags, whatever) do okay, better if you have the skills to build a compelling web/social media presence Wouldn't bother with homemade cakes unless it's an addition to an existing stall or can be done in combination with a food/drinks stall. These guys never last more than a couple months. Ice cream/ ice blocks is hard. Too weather dependent, seen many of them fail. If you have any ideas, bring them up, I'll help you develop them. Ask away, any other questions.
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Dec 15, 2014 03:49
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fruition posted:This makes a lot of sense. When I think of the happiest periods in my life it had nothing to do with how much money I was making. In fact, as my wealth has grown my happiness has proportionately declined. When I was happiest, all I cared about was working just enough hours so that I could cover my bills and still have pocket change to be able to go to bars and take chicks out to Olive Garden and the movies once a week. Now I'm miserable because I feel guilty for only saving 30% of my gross when I know I *should* be saving 70% of it and then FI would be possible for me...if only I had kept the same lifestyle expectations. I think the process of deciding to focus on FI involves bringing a low-level background stressor (how will I pay my bills, how much money do I have, oh god I shouldn't have spent all my rent money at the Olive Garden) into sharp focus. Realising that you, and most people, are so controlled by their income and spending habits, is an eye-opening and uncomfortable experience, especially when you can see that there is actually a 'way out' that most people don't know about or aren't choosing. Being alone or in the minority in pursuing this goal can be isolating and difficult, I think in general people around you will not have the spergy knowledge of numbers and finances that usually comes with the territory. I'm going to guess that because you don't have anyone to measure yourself up against in the real world, you're measuring yourself against blogs/forums/other resources online, which is where the 'should' attached to '70%' is coming from. I think this is a phase that many people go through. You're not alone in feeling that way, but it passes. I think it's good to feel like that for a while because it really pushes you to that point of really measuring up your wants and needs and looking critically at your financial life. Once you've got that new equilibrium going for a while, where you save all that can be saved and you know the difference between wasting and using money, it will go away. Reading online resources will most likely phase out with this feeling also, as you've established the basics and can't do anything more.
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Jan 25, 2015 06:08
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Blackjack2000 posted:To be clear, I am totally on board with achieving FI. I want to do it, and I've changed my spending patterns to reflect that. I just get really tired of seeing wage and salary workers portrayed as sheep and cattle. There's more to workplace satisfaction than just being able to walk away from a bad situation. I think this is important to note. You wouldn't all be contributing to this thread if you weren't on the same level about this. You can love your job or hate it, but no one actively desires a dependence on their job. Give a million to two different people and one will happily retire while the other will work the same job 'til they drop dead. What I think is important is simply raising consciousness around personal finance - literally raising it into focus, because it seems like a lot of people just work and spend without really thinking about where their actions will take them. If you take that conversation and split it into a debate about 'BUT WHAT WILL YOU DO ALL DAY' it muddies the water and less people will truly take the time to understand the concept of financial independence and what it could mean for them personally.
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Mar 2, 2015 08:18
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shrike82 posted:Is FI primarily an American phenomenon? I feel it's very do-able in Australia, we've got generous wages and an adequate social security system (although it is slowly being attacked by our horrible ruling class). The spanner in the works here is outrageously priced property & rent in the major cities and ever-expanding surrounding areas. Obviously this can be got around by moving further away/sharehousing/van down by the river, but it's the major hurdle I face personally.
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May 11, 2015 23:56
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If you have access to homebrewers already, just do swapsies with something you make/have. I've found that as a bunch brewers are always eager to give out the goods - even sometimes just for the feedback.
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Jul 17, 2015 00:12
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Minty Swagger posted:Do you all have any other podcasts you listen to other than the previously mentioned radical personal finance? That one I maybe listen to every 5th show as they're sort of all over the place recently, so I'm looking for some new options. Not directly related to FIRE I guess but Planet Money is frequently interesting and also the APM: Marketplace has pretty interesting and succinct pieces of decent journalism (and the daily market reports are entertaining if only to see your own reactions to them over time). Family Adventure Podcast is a fun way to dream about the pot o'gold at the end of the FI rainbow. If travelling with family is one of your goals.
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Oct 17, 2015 09:03
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froglet posted:So how did this pan out? Are they still running the market? I think the particular guy I was thinking of didn't get the spot, was outbid by the 'big player' in our local market scene. It greatly depends on how saturated the market scene is in an area, we've got way too many in Sydney now and they have to compete not only for foot traffic but also for decent stallholders. The trend I've seen lately is for new markets to have a bumper first day followed by a several month decline into obscurity/cancellation.
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Jan 17, 2016 21:00
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400k dang thats alotta dough. like woah. what a champ. I'd like to see him host the Stoic Olympics, with cash prizes given to the Fastest Barefoot Sub-Zero 10 Mile Commute, Oldest Still-Functioning Cellphone Still In Daily Use and Longest Distance Travelled To Pick Up A loving Penny.
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Feb 23, 2016 09:05
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Hey thread, it's been a while. Recently decided to give the finger to my current job (due mainly to abuse of my 'on-call' status out of working hours) and live off our business (15-20 hrs per week work) for a while. Given myself (and the employer) three months, setting aside the extra money from that time to buy/make an RV for travelling around in. Working for a specific goal makes it easier to stay a little longer - watching a large number in Excel gradually get larger is not motivation enough at this point. I'd say I'm about 1/3 of the way to actual FI, but our business brings in significantly more than we need so we'll be making good monthly contributions and won't be withdrawing from the stash at all. If the business holds steady for a decade or more that'll bring us up to the magic FI number, though I'm not opposed to working in future if the right opportunity comes along. No idea at this point what I'll do with all the free time, it'll be interesting to find out. I'm gonna have a coffee and rewrite the OP, the rant about my own situation is probably not the best landing pad. Chadzok fucked around with this message at 02:08 on May 6, 2016 |
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May 6, 2016 00:04
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Done. I'll throw up any other suggestions to the link list or the glossary.
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May 6, 2016 04:57
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Do you have any skills you could leverage into part-time work, self-employment, or a different career track? Anyone you've run into during your career time doing something tangentially related but more self-directed? Hard to know without some career details but maybe you can think about this yourself. Your car seems unnecessarily expensive, especially if FI is your primary goal, but it's probably too late to back out of the lease now? I dunno, never leased before. Leasing is dumb and your car costs too much. Any options here? $3000 a month living expenses seems excessive considering you have no mortgage or rent. I see you have a new kid, but again - if FI is your goal here, every dollar you chop off this is invaluable. How's your budgeting muscles? Great job on owning your own property outright! That's a massive hurdle particularly for people in Australia and honestly with that in your pocket you're running downhill to FI and the wind is at your back. Can you put your hand up for the redundancy payment? That could give you a couple months breathing room to pivot, especially if you had some better ideas about what direction you want to go in. Finally, work out how much of that 80K you want to keep as an emergency fund (6 months livings-worth?) and put the rest of it to work somehow (I suggest index funds, Vanguard specifically) - 3% is not 'earning', that's just matching inflation. Your financial independence 'stash' needs to be invested in the market, bank account returns will not cut the butter. If you want more info on this, ask away, I'm an Aussie too, most of my money is with Vanguard.
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May 17, 2016 09:01
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Hey friend. It's me again. I couldn't stop thinking about your car lease and what a horrible deal it is. Here comes what is commonly known as a facepunch. You are spending a third of your total budget - what most people allocate for housing - into a vehicle. Moreover, you seem to be eagerly charging forward with this so you'll have the privilige of spending TWENTY THOUSAND DOLLARS MORE on this solid gold blowjob-giving machine. Destroy that lease with the fury of 10,000 suns, take the $8800 you would have spent on it between now and December and buy a perfectly good rectangular metal box with wheels that serves the purpose of getting you around, instead of the purpose of trapping you in a perverse cycle of hard work and despair. How much have you already fed to this demonic automotive wealth-devouring hellspawn? Don't fall for the sunk cost fallacy, the resale value is not worth working towards. You'd have to replace the vehicle if you sold it anyway. EDIT: Hmm, read your numbers again. You put it differently, subtracting your car payment from your income. I think you're tricking yourself there - it's an expense, even if it is pulled from your pre-tax income (I read up what a novated lease is!), because otherwise you'd be getting that money as income. I really hope that it's a deal you can pull out of, transportation is not worth what you're paying, over 25% of your total expenses. Are you in some sort of career where you have to be 'seen' to be having the fancy car and all that tripe? If you're looking for tax advantages you'd be better off salary sacrificing into your super. Chadzok fucked around with this message at 13:51 on May 17, 2016 |
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May 17, 2016 09:43
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I think he could do way better than that. If you both kept working at your current wages, found $500 savings on your living expenses (shop at aldi), put the 1000 a month after the lease is up towards savings instead, and also set up a substantial weekly salary sacrifice into super (there is a reason rich people do this - a 15% savings on your tax is an instant 15% return on your money), you could do it in under a decade. Light reading: http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/ In fact if you really want to start educating yourself, read his whole blog post history cover to cover. You'll know a hell of a lot more than when you started, he covers investing and you will learn to not be afraid of the big bad market. All your instincts about property and negative gearing are correct. Bad idea.
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May 18, 2016 01:02
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Investing for FI can be kept incredibly simple. Best to do your own reading and research to draw your own conclusions. The conclusions you come to will most likely be either "bulk buy Vanguard ETFs every so often" or "open a Vanguard managed fund and make weekly deposits". There's no rush though, do some reading yourself, come back if you get confused or if you need Australia-specific info. When you know what you're doing you can look into your super as well, in terms of how it is invested and what fees you are being charged.
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May 18, 2016 02:23
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Mofabio posted:Anybody got a progress update? I got sick of my job (plus an injury) and we just live off our saturday side business now. Covers all our expenses plus can save very slowly (2k a month savings down from 10k a month). Might go back to work at some point, maybe change careers, lots of maybes. Just relishing the time off for now. Kid due in 5 months, shouldn't impact plans too much. Could even be that this is a permanent state of affairs if the business stays steady. Rick Rickshaw posted:Yea I can't think of anything worse off hand. At least computers are fairly upgradable if you're really into high-end gaming or something. I bought a souped up gaming rig before I left work only to find that I now have zero interest in gaming. Seems like it was just a work-stress outlet. Runs a sick chrome browser though. Chadzok fucked around with this message at 11:06 on Sep 21, 2016 |
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Sep 21, 2016 11:02
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baquerd posted:Thinking of pulling the trigger on FI again, but I don't really want all the hassle of starting my own business (I'm in big-data software at the moment). When I get bored, I tend to do silly and non-productive things, but maybe that would change if I didn't have a job? Anyone out there who has pulled the trigger who can talk about how their priorities changed and such? My wife and I are looking at our first kid sometime next year, so continuing to have 100% subsidized insurance through work is a nice to have if things go badly, but unless our expenses skyrocket (as they easily could if a kid were to be born hosed up enough), we're good to go financially. My wife is 100% stopping work when she gets pregnant, just my employment is in question. Hard to know exactly what you're asking here.. Does 'good to go' financially mean you've crossed your minimum FI mark? If so, is starting your own business a necessity or something you'd just like to do? I left full-time work this year, a kid on the way (next Feb), and running a small business to cover our expenses - silly non-productive things still continue in the evenings but you'll find other stuff to do during the day. Personally I find that self-motivation will never give me the same productivity level as having to be up and at a job every day - but that level of productivity normally comes at the cost of my health and sanity. I prefer a more sustainable, leisurely approach to getting things done. Priorities during the last six months have been on preparing ourselves/household for incoming child, more time with family, health and diet. I've done a fair bit of work on the business as well but new ideas roll out over a month or two, I don't really give myself deadlines or anything remotely resembling stress. I did pick up some temp work for a four week period to cover all the stuff she wanted to get for baby - I didn't really need to but more than that I didn't want my financial momentum to be affected. It worked out well and I'll probably do it again in future when big purchases crop up. Very easy to find short-term work in my industry, yours may be different. Keep in mind though I'm in Australia so I don't really have to think about health insurance.
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Dec 28, 2016 22:04
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Blinky2099 posted:OK yeah, 200 years in one of the highest returning markets in the world seems like a tiny sample size and pretty risky assumption to make. I read on MMM the other day that if your plan is 4% withdrawal rate in years when your stash is >= your starting balance and 3.3% on years when your portfolio drops below your starting balance then you would have never run out of money (based on historical data) on any 20-100 year length retirements. I think having some things in mind you can do to cut back (or temporary work you can pick up) in years when the market drops considerable amounts means you'll be absolutely fine unless asteroid/climate change. I did like using the starting balance as a reference point, I thought it was a great system and I'll be working that into my plans. Chadzok fucked around with this message at 09:12 on Jan 7, 2017 |
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Jan 7, 2017 09:10
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Jon Von Anchovi posted:I'm in Australia if it matters. I bank with commonwealth bank and have bought shares in the past through commsec (owned by the bank). I also have my superannuation with a company owned by commbank. This is nice because i can log into online banking and see absolutely everything. I can transfer cash into the linked money market account and then buy shares at $19.95 a trade. Hey mate, I can't answer all your questions but I can tell you the decisions I made for myself. I had an initial lump sum (30k+) so I used a NaBtrade '30 free trades on signup' to bulk-buy ETFs with no trading costs. No brainer. Then saved up the 5k for the retail fund, at a similar rate to yourself. Then, when the balance for that fund reached 100k, I switched to a wholesale fund of the same type. (The website says $500k - call them up. It's actually 100.) For me the benefits of the easy regular BPAY and auto-rebalancing/re-investing for the funds far outweighs the sub 0.5% difference in fees. (Particularly for the wholesale funds the difference is minimal) Also minor point but some of the ETFs do not have reinvestment options (eg VTS/VEU) and every quarter I have to juggle annoying little dividends from my ETFs. Bottom line is there is not a huge difference and it's basically convenience (Funds) vs best possible long-term return with extra work involved and short-time higher costs (ETFs)
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Feb 12, 2017 07:52
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OctaviusBeaver posted:I think if returns start slowing it's because we don't have the next big invention to drive productivity growth yet. The industrial revolution kicked off in the 1800s and we got steam power, oil, chemicals, pharmaceuticals, cars, airplanes, nuclear and all sorts of totally new stuff that completely changed the world and gave us a ton of growth. Then the 1960s-1970s hit and we had computers which were almost as big of a deal. Now we have computers that are so fast that making them slightly faster doesn't help as much, we only get small incremental improvements. Going from having no computer to a slow computer makes me a much more productive engineer. Going from a slow computer to a fast computer makes me slightly more productive. Going from a fast computer to a really fast computer only helps a tiny bit. So rapid, sustained growth like we saw before is going to be difficult until somebody comes out with the next big thing. Robots. If by 'rapid, sustained growth', you mean 'rapid, sustained rise in profits/inequality'.. then the answer is robots. It's already happening. In terms of quality of life improvement, what could be better than a robot doing your job so you don't have to? (Please ignore the fact you are now unemployed) Chadzok fucked around with this message at 02:26 on Mar 17, 2017 |
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Mar 17, 2017 02:24
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If anyone wants to take a bet on their wager, I'll give you 5 to one odds on Mofabio for amounts above 500 million.
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Sep 5, 2017 00:01
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radialright posted:Has anyone here successfully FI-ed or retired early? I'm at a point where I can seriously consider it: I now have roughly ~$1.5MM in investment and retirement accounts. With an estimated $40k/yr expenditure rate and a 4% withdrawal rate, firecalc puts me in a relatively risk-free zone for retiring early. Kind of. I got to 40% stash and stopped because my one-day-a-week business covers life + some savings. Also I'm pretty sure I would keep doing the business anyway post 100% stash. Anyway, I completely 'wasted' a year to, basically, videogames and hermitism. I didn't have any weed but if I did I would have smoked it. Maybe your sabbatical won't be as long, but you will definitely spend a time revelling in the freedom that you haven't had since you were a teenager, and you will regress. We have also had a child in that time and to be honest babies are only expensive if you or your partner choose to make them expensive - everything can be done on a budget and with hand-me-downs. Families will be coming out of the woodwork to hand over all their baby crap from the cupboards/garage. I think kids gets more expensive with schooling and mobile phones and vehicles (I'm Australian, so 'saving for college' is a foreign language to me) but even then the cost is up to you, really. I am very cautious about having a second one but that's only partly because of the cost. It's mainly because they need so much time and energy from you that the idea of two babies is just despair inducing. For what it's worth I have also since found a strong new direction in life that I'm pursuing, in terms of tertiary education and potential career, and re-educating as an adult with free time is awesome. I've never studied so hard in my life. And yes, much like Mofabio, I gained 10 kilos. Purely muscle, I assure you. quote:I think that in retirement, your job becomes finding out what you actually want to do, and the answers might surprise you. I would totally agree with this.
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Sep 14, 2017 22:50
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Jeffrey of YOSPOS posted:I don't often use RPG consumables because they aren't generally challenging without them and using them requires tedious menu'ing. A good RPG would have very limited really strong consumables and would be impossible to win without using them effectively - I've yet to play one. Yep, same here. Couldn't be bothered, I just stack and sell then put the profits towards my characters' financial independence.
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Jan 26, 2018 01:30
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Jeffrey of YOSPOS posted:Oh yeah I bought that right when it came out lol! noob! u just pushed back your FIRE date by a couple days dipshit! steam sale next time bro peace
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Jan 27, 2018 10:35
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Dreadite posted:"Can I "stop investing" at 33 with 500k in the bank?" This is almost precisely me, although I'm still managing to dribble a few hundred a week into investments. We've cut work right back to basically dual-stay-at-home parents. Childcare benefits are great in Australia though (the kids are essentially going to be making a profit unless they start costing more as they grow) so YMMV on that point. I might pick up some extra work in the future or I might just let the investments 'coast' us to retirement. It really comes down to just deciding on the lifestyle that you want to be living. I used to be happy slogging 60+ hour work weeks for the sake of investing, but my motivation shifted dramatically after 400k, and then again after children. Nowadays I work minimal hours and just make sure that all the numbers are in the green and don't worry too much about specific 'fully retired' numbers. Personally I think if you can set yourself up with either of those goals you described (33/500 or 38/750) and then be in a position where you can either work significantly less hours or do like a 6 month on/6 month off kinda thing you'll be in a good position to have a lot of control over your own lifestyle.
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Oct 29, 2018 04:04
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I've got a Vanguard investment account going for each of them that I've been contributing what I think is a generous weekly amount to since they were born ($50 AU). The "giving it to them" part is waay off in the future but the vague plan is when they understand that saving for the future is an important thing to do, I can show them the headstart that I've given them, possibly with a bit of a discussion about the money I've actually put in vs the growth/dividends over time, etc. Kicking off a business or needing expensive education (or I guess *shudder* a house deposit) are also possible uses but I kinda want it to be the seed of their own FIRE plans (I acknowledge that they may have very different ideas about money and ultimately it's up to them). As for "I'm dead" level of inheritance, it would just go all go to Mrs and after that an even split between kids and I don't care what they do with it because I'm dead. Maybe by then I'll be more philanthropic and I'll nominate a fraction for the poors. Chadzok fucked around with this message at 01:27 on Jan 26, 2020 |
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Jan 26, 2020 01:22
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My business has been forced into hiatus but government assistance (Australia) is keeping us treading water. It's a shame I can't take advantage while there's blood in the streets (speaking in a financial sense here, please excuse the morbid nature of my comment) but I've found I'm not particularly concerned about the precipitous drop nor the potentially protracted downturn. My plans haven't changed, just paused. If the business closure outlasts the government assistance (which I doubt, the government appears to be willing to provide safety nets) then I guess I'll have to get some sort of work. The only x factor is if my business doesn't recover to the same level of income - but again, I can't really control that so I don't find myself thinking about it all that much. All in all, we'll be fine.
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Apr 29, 2020 00:19
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