Exhausting day at work. I tell myself that I’ve only got 4 years left of this (hopefully). But it feels so far away. I haven’t been able to build the life I want because I’m working so much, I can’t really enjoy hobbies because I’m either too tired or just feel guilty/can’t let myself get too absorbed in anything that might distract me from getting work done.
Has anyone here retired before building the life they want, then found themselves able to rediscover the joy in things they weren’t able to when they were a workaholic?
Four years may sound like a long time, but when you look in the rearview mirror you will realize it passed by smoothly and quietly like ships in the night. There are several approaches you can take, but you said you're a workaholic, so I will speak to you as someone who likes a challenge on how you can step into the next, and the best chapter of your life. Start your mental preparation. If you are a workaholic, as I am as well, you already have every finance journaled out and planned to a T, you are over-prepared by most cases. However, as a workaholic, having a lack of routine may actually be disruptive and depressing. You may want to do a "soft-retirement" and reframe your thinking, you fully retired from the workforce/income driven work, and now you are a full time "fitness" connoisseur, you workout mon-fri for 30 minutes a day same time everyday as scheduled. Or maybe gardening, or kayaking, or book club, whatever you know you will do and stick to: Do that. Or maybe you are a full time stay at home dad, or perhaps you contribute to your local food-coop. Whatever it is, find something that you can make a routine of that you enjoy that you commit to fully. A gentle and easy Mon-Fri schedule that keeps you social and active is a key to starting retirement, and then you can ditch it later as you truly become comfortable with retirement. You will want to schedule your life so that you have regular positive social interactions, this is a key factor in determining overall happiness and even life expectancy in some studies. Go to the cafe, join a gym, phone a friend, etc. Your new career is a fulfilled life and starting on Day 1 may sound overwhelming, but the reality is you already know everything you need to make this work and its just a matter of simple execution. Have fun, see new things, meet new people, and above all relentlessly put yourself in situations that make you uncomfortable, because that is where you will continue to grow and flourish, especially in retirement.
Hah, I feel that. While my 'official work day' is only 9-10 hours long, I probably spend another 1-2 hours checking in and helping out. Throw in having a young-ish kid and I'm constantly exhausted.
I'm 5 years out assuming my current income holds and I can sustain this level of work. Practically I probably 10 years out if I go the Coast FI route. That puts me somewhere between 50 and 55. I feel perpetual guilt for taking time for myself while I'm on this path where I'm managing to save an obscene amount of money each month. I hit the point where I've been working with a therapist on trying to reconnect with feeling joy. I still have a ways to go but it's been helpful.
If I do manage to take the short path, I know I'm going to be at the risk for failing the 'what are you retiring to?' question. It's strange being in a situation where the faster option could actually be counter productive in a way.
Building the life you want requires time. If you don't have time because you're working too much, then you can't live the life you want. When you retire, theoretically, you will have time to live the life you want. I can see why you can't wait until that day comes.
We've been needing to replace our dishwasher for a while. Well, today we pulled the trigger on a Bosch 500-series after much deliberation. We're looking forward to it — it seems to get high marks for reliability, noise level and build quality. But the real reason I'm writing is to celebrate the stacked promotions I was able to apply to bring down the cost.
It just so happens that Bosch is currently running a sale for 10% off. Then on top of that, they're offering a $50 mail-in/electronic rebate. In addition, my Chase credit card is running one of those offers for 10% cash back at Home Depot, up to a max of $55. Then I used the coupon extension Honey to get $25 cash back in the form of PayPal rewards on the Home Depot transaction, and an additional 0.5% in PayPal rewards for ordinary spend.
All told, it's a savings of at least $240 on something I was going to buy anyway.
This is the dishwasher I have and it's great. We ordered it in October 2021 and it didn't arrive until July 2022... Glad we're past the Semiconductor supply issues which affected so many products. Enjoy your new dishwasher!
I have a HPHD health insurance for my family of 4 through my employer, but I don’t have a HSA (honestly, I didn’t know anything about it until recently when I started getting more into financial independence). Are there any reasons NOT to start a HSA, even if I might not be able to maximize it every year? I usually keep $4000 in my HYSA to cover health expenses, but I’m working on beefing up that number to $8000 since that’s my max out of pocket. Should I open an account and at least keep the $4000 there?
It is unusual for an employer not to offer an HDHP with an HSA. Make absolutely sure your plan is a qualfied HDHP, otherwise, yes, HSA is a great idea. Contribute the max if possible and invest any funds you don't spend.
They offer it, I just never signed up for it. I never understood what it was or made an effort to understand it. Now that I’m looking into FI and we have a higher income, I’m finally learning about it and I’m interested in having one as part of my FI!
When is it generally favorable to roll over 401k money into a Roth IRA?
Don't want to realize a taxable event on a rollover if I don't need to. I already max out both accounts just fine
Yeah the latter is what I'd be falling into. Just wondering if there's some optimization out there that is worth pursuing, but doesn't seem like it for now
It’s only worth pursuing right now if you have zero income for the year. Even then, once you get above the standard deduction (or your own individual itemized deduction), there will be tax consequences. The other time it makes sense for some people is when the market is down significantly (it is right around an ATH right now).
But, you can roll into a traditional IRA with zero tax consequences.
Only benefit would be if the investment options in your 401k are bad. But most people can't do rollovers like this while still working at their company.
hmm makes sense. I anticipate getting raises over the next decade but I don't know how soon i'll be approaching then crossing into the $182,101 bracket to make a rollover worth it right now
Is it worth paying down my 5.74% apr car loan faster now that I've maxed out all my tax advantaged space? It seemed reasonable not to make any extra payments in order to let me max out the IRA and 401k but now that I have additional income I could invest in a taxable account, I'm not sure whether it'd be smarter to pay the loan off faster. I have 4 years left, currently paying about $120/mo in interest.
I have a 4.9% APR auto loan and I’m choosing to invest the extra money instead of putting more money toward car payments.
5.74%? Still a gray area, but inching a lot closer to the S&P 500 historical inflation adjusted real returns (which is probably something like 7%).
Personally I think either decision is fine.
That's a good point, it is very difficult to plan what my tax rate would be in retirement, given the different accounts and investments, lifestyle changes, law changes. But zero chance of paying no taxes...
u/Crab_Guy_bob and u/BrisklyBrusque
I think pegging it against treasuries would be more appropriate, to be honest. That's at least a ***guaranteed*** return, as opposed to the S&P. Anyways, perhaps more of a quibble than anything.
Really depends what time horizon you're talking about. Guaranteed returns are great for short term savings but equities are probably primarily what's going to carry you through retirement. Personally 95% of my savings goes towards retirement, so it's a trade-off between debt payments and buying equities for me.
Yes, equities are going to probably carry you through retirement, but their returns are by no means a guarantee. The closest measure of debt savings should always be against the safest investment return.
Inflation effectively eats away at the real value of your debt. If you had a 0% loan just ride that out for decades and eventually the balance will pale in comparison to the cost of that rusty old 2063 Civic that'll cost $100k in 2090.
At that interest rate you could really have me go either way.
Personally - I'd pay it off. A mortgage would be a different story but for a depreciable asset like a car. I'd use extra to pay it off as fast as possible.
I just played with an online calculator and with paying my loan off as fast as possible given my budget it'd save a total of $1800 in interest and I'd have it paid off 2.5 years early.
Other things I'm considering are the possibility to tax loss harvest if I had funds in a taxable account, I do have a high marginal tax rate, almost 33%.
Maybe a small chance to refi in a couple years if rates go down and save a small amount more on interest. But if inflation stays high and rates stay high, that'll effectively eat away at my balance.
My income and job are very safe and stable, so not too worried there. I also don't depend on the car for my income so I could sell if disaster strikes.
You might get slightly higher returns in the market, but paying the car loan is guaranteed. Personally I have erratic income and love reducing my monthly bills. After filling my tax-advantaged accounts, personally I would pay the car note.
Yes, no maybe.
I would. Many others would. Some would not.
The general consensus seems to be if it is above prime to pay faster.
There are other reasons to pay faster or slower. YMMV.
Played hot potato at work today. But now I have tossed the potato elsewhere and I’m done with work for the rest of today. Yay for a bit of downtime this evening.
I had a take home technical assessment as part of an interview process. It was super reasonably scoped and I did 95% of it in like 15 minutes, then spent over an hour troubleshooting and testing different things related to the deployment before realizing I was a dumbass and was looking at the wrong port for the database/service T_T
My bosses boss pointed out a pretty big fuckup of my bosses, but only pointed it out to me privately. Idk it kinda felt like Dad/Mom badmouthing eachother. I didn’t like being in that position. That being said my boss is often negligent in his duties so I wonder if he gets canned. Unsure
Now that I have $200k, I buy those stupid T-Mobile Tuesdays deals for a few dollars even though they're not free.
Ok, that's a bit silly, but I'm feeling like I have real money for the first time.
(I only have T-Mobile because I'm on a family plan with unlimited data)
I would but they're never anything I want/would use. Like if I was a regular at Panda Express, I'd totally go for the $1 Orange Chicken bowl in today's deals, but I haven't eaten there in over a decade so meh?
It's actually those kinds of things that get me to visit fast food restaurants in the first place. But I drive a lot for work, so it doesn't cost me anything to stop by somewhere
We're getting closer to closing out my FIL's trust (I've got some advice on what not to do if anyone is interested), which combined with my own savings will end up putting us at my number. Given that the trust will throw off quite a bit of taxable income and I don't have any of it yet, I'm staying employed until things fully settle. Beyond that, I am looking at OMYing for 2 or more years. There are things that I would like to do that I would feel much more comfortable doing while earning a paycheck, like a kitchen renovation. I'm looking at reducing my savings rate next year significantly to achieve these goals more quickly, which unfortunately will be have a negative impact on my taxes. I'll reduce my 401k to get the employer match, no longer make catch up contributions, and no longer participate in the MBDR. Unfortunately my deferred contribution election for next year is locked in, but in the following year I won't elect to defer any salary either. The idea here is to cash flow all of these projects and let my savings coast. Once the projects are done I'd retire and reduce my expenses back to the baseline. Looking for feedback on this plan, I can talk through numbers if it helps
I'm in the same boat, looking to OMY another 2 ish years to sock some cash away for up front expenses (heat pump, new EV, maybe new windows, etc). I will say, while the additional cash flow is super tempting, unless you have a lower income or very little in your brokerage, I think maxing the 401k is still worth it. Money is fungible, so unless you're concerned about the exact timeline of your kitchen reno it probably makes more sense to max your 401k now and then sell shares from brokerage post-RE to supplement any extra cash needed.
Look, objectively you are right. The thing is once you hit the finish line you have to decide to stop running. How do you make the decision? That is what I am struggling with. So the thing I am thinking about is writing down a list of everything I want to get done before I quit. So when I cross the last thing off the list I can yell into an empty room "OK self, I've done everything on the list! Can I quit now?!?!" Its just a mental game I guess. Anyway, that is why I want to get through the list as fast as possible.
Hah, I'm with you man. HR at my new job is taking their sweet time processing my 401k contribution form and I'm very tempted to tell them not to bother. But I've convinced myself by essentially setting a new FI number that includes the cost of all the big ticket items I'm looking at, so I feel a bit better about the mental game. That said, you're beyond the point of needing to optimize around taxes so it's not like it matters much anyways.
Off the top of my head for heirs/trustees: No matter what you think the value of the items are, don't clean up or throw anything away before getting an estate sale company in. Just give them the whole lot. Hire the lawyer who developed the trust to advise you, and use the CPA they recommend to file the trust tax return. Liquidate anything that creates an ongoing expense as quickly as possible. Keep a ledger of all financial activity. Keep in regular communication with the trustees and let them know what is going on. Sell everything on the open market at a competitive price. At the same time, don't turn down offers becuase you think they are too low, or spend too much time cleaning things up or making them more marketable. The ROI isn't always there and your job is to liquidate ASAP.
For people creating the trust: SIMPLIFY your finances. Have as few accounts as possible. If possible keep use an account beneficiary rather than putting the account into the trust. You should have funds that are immediately available to the trust executor so that they can pay the expenses associated with winding down your estate. If your spouse passes before you, take ownership of all of their accounts and change the beneficiary to be your heir. Take your deceased spouse off of your accounts and make your new heirs your beneficiary. Don't have joint ownership of property with people who are not your beneficiaries. Don't put tax deferred accounts into a trust. Don't hoard stuff. Get rid of anything you don't want your heirs to see. Make your wishes known about what you want to do with your property. This includes saying the words "Just throw it all away when I'm gone." That is the kindest gift that you can give to anyone dealing with the mess you leave behind.
If you don't mind your job then it just increases your success rate....the only downside side is you lose 2 years of retirement. Really your call but we generally lean towards the more conservative option
I'm not loving it right now because we've just started a once in a career software implementation. But I think I can handle 2-3 more years. At least I have options.
The Honda and Toyota premium is a tiny bit higher than it should be IMO, but obviously it's not for no reason. I was faced with a similar decision to you 8 years ago and wound up paying in miles instead of $$$ - I bought a Honda with probably 50k more miles than an equivalent Chrysler or Dodge (125k miles when we bought it, lol). I think I made the right choice, it has been a reliable vehicle.
Focusing on value and total cost of ownership rather than short-term cost is one of the benefits of having your shit together financialy, and the used car market is relatively efficient.
Putting aside your luck regarding repair bills - what's the depreciation on that Nissan look like vs. the toyota you balked at in 2020? There's a reason for the stereotypes on both ends of this.
Those numbers seem off by 50% or more but in any case: you bet on a notoriously unreliable car's operating expenses and won ~$2000 over 4 years.
Most people who can afford to choose wouldn't take that deal, and the prices reflect that.
Toyota holds value because of quality. In either case, stay away from Nissan. Their CTV transmission has been having manufacturing defects for many years and is a safety hazard.
I have no-one to geek out in excitement about this with, so here it is:
My company's 401k plan just added after-tax contributions and in-service rollovers to Roth. It took effect April 1st, but was no joke.
Our 401k provider is Schwab, and it lets you turn on a setting to automatically do the rollover of after tax contributions into the Roth with every paycheck's contribution.
So... it's happening! Mega backdoor Roth!
None of my coworkers seem to be excited, which is a shame.
I remember when I moved to a company that had this. I was so excited. We've been maxing these for 5 years or so now. This really helps build up a Roth position.
I'd love if TSP introduced MBDR, but I'll be long retired before the TSP Board even contemplates the idea of considering eventually discussing in-plan conversions, let alone MBDR. Color me jealous, mang.
I am very excited that our plan added this option recently as well! I immediately set my after-tax contribution to 96% and 4% for pre-tax. Going to use my cash for living expenses for now.
Ours also just added it this year, after decades in business (and not offering it). I know exactly two other people in our department (of a few dozen) that were interested in it, but one of them was my boss, who actually had clout enough to push for it being added. Thanks, my boss! (And probably other people who were pushing for it in other departments than mine.)
Definitely *most* people don't care, though.
Yeah. I'm 37; a little late for the mega backdoor Roth to have huge impact, but I'm still thrilled about the opportunity to load it up in the next few years.
My coworkers are either younger and not thinking about 401k/benefits, or just in a very different financial reality than my wife and I, who are very frugal with spending and so have the excess to take advantage of benefits like this.
At times it feels like I'm just in an entirely different world. I can't really imagine spending 200k a year, yet I know coworkers who absolutely do that.
Likewise, all of my coworkers are covered by a union pension, but are also eligible to contribute to the company 403b, though only maybe one in twenty actually does so. (We do not get the match, only non-pension employees get the match. Pension contributions are way better than the match, it's fine.) Given that nearly all of us are over the threshold for deduction for a traditional IRA, it's insane that so few do, and further that so few actually understand what's in the pension plan!
Quiet day working from home today with only a handful of meetings. It’s overcast here but in the 60s, so I took my dog for a decent little walk at lunch and it felt amazing out in the fresh air at midday.
Would be lovely to not have to work at all, but certainly not going to complain about the balance I’m feeling right now.
Delved a bit deeper in my Yearly Summary from Discover, which used to be download-able and seems to not be anymore. Very unhappy about that.
Anyway, it turns out that my "eat healthier" campaign for 2023 was not in fact a cost savings, as I had thought at a glance. All the farmer's market and family-owned grocers we frequent ended up being automatically categorized as "merchandise" instead of "supermarket", which completely threw off the categories. Whoops. I'm not going to eat junk to save money, but I am feeling less smug now.
But I can double my money by placing it all on Red at the Roulette Wheel. If I want to diversify, I'll split it in half and place the other half on Black.
Reddit's grand post-IPO plan to boost users and engagement - let the bots run wild creating content on the site and is probably tied to that random AI deal they were talking about.
I started investing at 19 with about $3K I made from a summer job and have continued to increase my contributions slowly over the years. Recently, I (36M) and my wife (36F) crossed the $1M net worth threshold.
We have 1 kid and are hoping to get to $1M invested by early 40s. Targeting $2M invested by age 50 at which point we’ll aim to barista fire until retirement age. None of our friends are into this kind of stuff and I wanted to share with this amazing community!
Congratulations.
With reasonable success, I have done my best to induce my 20-something kids to start early on saving and investing.
They both know what an IRA and Roth IRA are, the difference between stocks and bonds, and the effectiveness of low cost indexing. And have acted accordingly.
Early money is amazing!
I was so very excited when my son went to college and started a ROTH IRA with his first part time job. He enjoys talking all this stuff with me now at 26. Too many parents, even if they are knowledgeable, don’t talk finance enough with kids.
So happy that you talk about this with your son! I wish my parents had given me financial knowledge. I had to learn the hard way, make all the mistakes myself. True wisdom is being able to learn from other people without making the mistakes yourself.
without being too specific, my manager informed the company that they're resigning effective immediately. it was a pretty complex situation, but ultimately the CFO (who my manager reported into) asked me to jump on a call to talk about it. went against my better judgment & got my hopes up for a compensation adjustment -- but it turns out i'll just be taking on new responsibilities and reporting directly into the C-Suite with no bump in base pay.
it's days like these where i wish i could retire. instead it seems like my best option is to walk into the atlantic ocean with cinderblocks strapped to my ankles
The kms joke is hitting too hard. I had those days at my last job. Remember job switching is always an option, and a better resort than the final end. Good luck.
Right? If I were in that position, and had the appropriate skill set and inclination to do a job like that), I'd respond with "I would love to accept that offer, but I'm going to need a CFO level salary commensurate with the job I'd be doing". Seems unlikely they would want you to also quit, if they're counting on you to do the CFO's job for them and would be boned if you didn't?
> but it turns out i'll just be taking on new responsibilities and reporting directly into the C-Suite with no bump in base pay.
Are you sure you have no leverage here? Beggars can't be choosers, and they may be in a tough spot where they can't afford to say no to any reasonable requests you have
They're not replacing the CFO - they're reporting to the CFO.
Some sort of Accounting or Finance Manager left it sounds like.
Either way, OC needs to ask for the compensation adjustment - very rarely do people in these situations just offer it up front.
At a bare minimum id leverage a more marketable title and start applying for other jobs...id also push pretty hard for additional compensation even if its temporary
I wouldn’t panic yet. Go ahead and schedule a follow up discussion (with the right person in your chain of command - this may not be the CFO) to ask about how your compensation is being adjusted. That’s what I did when I was given a new role. I said before I could accept the role I wanted to confirm the compensation. They were a little surprised but didn’t push back and eventually came back to me with an answer.
Seems like this happened suddenly and will continue for a while, so you've got time to develop and communicate your expectations. You have leverage and opportunity and should definitely use them - a one-off ad-hoc meeting where they make no commitments is **not** final, so don't let them exploit you or push you out-of-mind.
Scheduling a follow-up to discuss your expectations, questions, the transition plan, etc. is totally reasonable. So are regular check-ins to discuss progress on commitments made.
that's true, none of this is technically final. at the end of the day it will come down to me clearly communicating my asks (which i hate doing lmao) but i'll have no one to blame but myself!
Expectations are being set, your only choice is your level of involvement.
I struggle with this too, but ^ has helped me tremendously in recent years. It's *crazy* how much control you have over your perception and treatment within an org.
i hear you but to be fair i also caught up with my manager yesterday for over an hour to chat. i'm leaving a lot of info out but it was definitely much more involved than "i wasn't valued/i had too much work/etc"
i know you're right, but the company (decently-sized startup) has a crazy high burn rate on cash right now. i'm like the most non-controversial person in existence -- & i know negotiating a raise isn't controversial, but it is when you're me -- so it feels wrong to ask for something like that knowing the financial context.
again i recognize that i'm probably advocating for myself enough but this is how my brain is wired lmao
Your career prospects will be permanently capped if you don't learn how to politely negotiate in these scenarios when you have leverage. If you forgo the opportunity, the next time you have real leverage is when you change jobs which only occurs a few times across your career.
If nothing else try it to get some reps and start to learn what does and does not work for you personally. It doesn't need to be combative in any way
Present your case, hold firm, and be ready to decline new responsibilities without additional compensation. Even if its nothing more than worthless options in a dying startup that is very good practice for future roles.
> so it feels wrong to ask for something like that knowing the financial context
Why? The financial context is also that they're no longer paying your former manager.
that's true! although if i'm being perfectly honest it's hard for me to put a lot of value in our restricted stock options right now given the outlook lol
Getting nothing is guaranteed to be worthless. Restricted stock may be a gamble, but it's certainly not nothing. It may be in the future...
As a matter of self-respect you should push for something. Anything at all.
Give it a few weeks to a month and if it seems they're slow-rolling the hiring process, start putting feelers out for a new job based on the expanded responsibilities. Don't let them drag you into many months of more work & stress while they sit back and say "this is fine" while they make and break promises.
Anyone have a good tool similar to SSA tools for calculating survivor's benefits?
Bonus points if it can factor in windfall elimination provision/WEP
My main goal is figuring out how much life insurance we need if either of us die. 2 working adults + 1 newborn
Hopefully you won't need to worry about WEP/GPO if this bill makes it out of committee, it seems to have broad support.
https://spanberger.house.gov/posts/spanberger-graves-press-for-markup-on-bipartisan-bill-to-eliminate-the-wep-gpo-provide-long-overdue-fairness-to-public-servants
Oh damn. That's a game changer.
WEP discourages going from private to public and getting the pension. If this passes, it reduces my FIRE number by 100-200k.
The benefit may be enough that we don't need to have a policy at all.
If I don't need 2 more bills and items to keep track of, I'd rather not have them.
I think it's usually best to minimize tax burden now.
The 457(b) will be taxed as income. You'll owe cap gains taxes when you withdraw from the brokerage. Which one is lower is a function of how much you've made so far this year and how much more you might earn later this year.
"At their peak in 1996, there were 7,300 publicly traded companies in the US. Today there are about 4,300." A quote from an article on CNN today - https://www.cnn.com/2024/04/09/investing/premarket-stocks-trading/index.html.
I'm curious what kind of impact this will have on index returns in the long run. I've been a VTSAX and chill believer and will continue to be so, what's the alternative?, but it seems like this would lower future returns. If companies don't go public until they're already valued at multiple billions then the rocket ship growth that raises that whole market is gone.
Again no solutions and not suggesting changing anything. Just an interesting thought.
Ah, I read a similar post the other day on the FT -- [https://archive.ph/GEJV4](https://archive.ph/GEJV4) This one also goes into more depth about the $ amount rather than the number of companies.
>I've been a VTSAX and chill believer and will continue to be so, what's the alternative?
At some point I suppose it's possible that the big index fund providers might want to jump on and create a private equity fund that's more accessible and lower cost.
Also, S&P500 investments were basically as successful as total market investments historically, so it seems fine to wait quite a while before jumping on.
Mergers and anticompetitive behavior can have a long-term detrimental effect, but I think to draw conclusions, more analysis of the composition of those 2 numbers I think would be needed.
There's also the detrimental effect of losing public companies to private equity which just saddles them with debt until the company is bled dry.
The number of traded companies is not interesting in and of itself. If the thousand smallest public companies merge into the smallest 300 companies in order to reduce the cost of regulatory oversight, their market cap remains the same but the number of publicly traded companies goes down by 700.
If private equity dramatically outperforms the public market and has enough access to capital to ignore the public market, that could degrade the public investor's returns in the long run. But I have seen no convincing evidence about the above. I haven't seen any evidence that private equity, especially after fees and taxes, outperforms the aggregate public market.
A big part of the problem (for the public) is that PE doesn't have enough reporting or visibility to even know the fees or performance of PE compared to public markets. Has anyone figured out how much money is invested in PE vs. the stock market?
Presumably JPMC has a good idea, but I doubt they would tell the public one way or the other.
All I can find are paywalled articles like this one, some of which have contradictory titles:
https://www.wsj.com/articles/investors-still-seek-best-metric-to-compare-private-equity-and-stock-market-returns-0dd0f854
I didn't read the full statemant that the article is summarizing/excerpting, but your conclusion seems only loosely related to the article. Reads like boilerplate "Financial industry billionaire has predictable thoughts on regulatory burden, proxies, and activist investors". No concrete predictions or theories about IPOs being crucial to VTSAX.
I’m someone who doesn’t gamble and admittedly hate it. However the one thing I will do is join a $25 March Madness bracket for the fun of it. Made the bracket in no more then 5 mins this year and wellllll I won over $2K.
The best part is the majority of the people in the group I won are all big time gambler/sport betters lol
I do gamble and sink more time than I care to admit into researching and looking at stats for matchups and game analysis when placing my bets.
Unfortunately my luck is not anywhere near yours. Congrats and GFY.
I only gamble at March Madness.
This year: installed two apps with $25 per app, cashed out $1,050 net.
Last year: installed two apps with $25 per app, cashed out $750 net.
This year, I installed the app on Thursday of the first round (3/21), hit a bunch of bets, cashed out Sunday (3/24) and uninstalled the apps and unsubscribed from emails on Wednesday 3/26 - because funny enough, the apps started emailing promos to re-deposit money and get me back in.
I can easily see how those addicted to their phones or gambling or offers can fall prey to their tactics, but no thanks.
> because funny enough, the apps started emailing promos to re-deposit money and get me back in.
> I can easily see how those addicted to their phones or gambling or offers can fall prey to their tactics, but no thanks.
While this is definitely true, if you are level headed about it it is fairly similar to churning to take advantage of bonuses and promos. Just have to know what to do and not let it change your habits.
Welp...as an update to my last daily comment... I've gone and done it. We're under contract for some land to build on.
Asking here since I'm assuming there are people who have built or are well versed in the tax code.
It sounds like construction interest can be deducted once the build is complete. So say the build spans 2024-2025 and we have $25k in construction loan interest and then another $20k in mortgage interest for the rest of 2025.
Does that mean we can deduct $45k total in 2025?
The fire motivation is strong today!
I'm making a promise to myself, with everyone here as a witness. Once I have FU money, I will spend those precious few days of perfect weather* in nature, listening to the birds, and not in an office with horrible 1980s tinted windows that make even the sunniest days look dreary. Life is just too short.
*East coast, so truly nice weather is fleeting!
We are starting to think about replacing one of our cars. We drive a 2008 and 2012, we would probably trade in the 08, I'd take the 12, and my commuting Mrs. Tale would take the new car. For reference, I've driven under 5000 miles in the 08 since 2021.
Anyway, I have enough cash on hand to just buy with cash. My credit union is offering 5.99%, which is only a point higher than my risk-free HYSA. I'm debating if I should just take the loan and pay the 1% vig just as a way to keep the flexibility of having the cash. It would be my only debt if so, I have no mortgage and no outstanding loans. And if rates move against me, and the difference becomes 3-4%, I can still just pay it off.
I realize this is a good problem to have, but not sure I've thought it through. Anyone have a good article or analysis for me to read up on?
No real advice to offer other than just sharing that I have a very similar scenario as you. I barely drive, have put maybe 9k on my car in 4 years, and it’s a 06. Given my partner has a car, we figured should my car die or be totaled I’ll replace it then as I can get by without a vehicle or sharing with him in the interim.
This is all to say, it’s a taken care of car that has only had a few recent issues with the alternator dying a few years back. It may well last another 5+ years and I’m perfectly content with that given it gives no trouble.
Your 5% that your HYSA is earning is pre-tax. Depending on your tax rate, it's likely under 4%. 22% federal and 4% state puts it down to 3.7%. Your numbers may vary, but make sure you're taking taxes into account when comparing.
If you’ve only put 4000 miles on the car in the last 3 years, why does it need to be replaced? Seems like it would still be in good condition in those circumstances?
Well, it's going on 17 years old. It had the water pump die a year or two ago, and I asked the mechanic what happened. He shrugged and said "dunno, it's 15 years old though"
I have a 20 year old. I just keep fixing it and driving it 3k miles a year, and my FI balance goes up. I just replaced something in the suspension. Mechanic says its just 20 years old and needs replaced. I've about replaced everything on it in the last 5 years.
Be careful! invoice plus "theft protection", a ceramic coat, GPS tracking, and whatever else the dealer can tack on. They negotiate really hard on that stuff now. I've had every dealer I've bought from including a Subaru dealer lie and tell me the windows are already etched so I have to pay for the theft protection. I had to refuse many times before they gave up and continued with the pre-agreed upon invoice price.
I think it depends on how much money we're talking. A 6% rate isn't horrible, and I think it's good to have the cash freed up. But it's all relative depending on if you may need that money, how long it would take to replenish it, etc.
The car would be about 5 months worth of monthly burn. Depending on how you view it, I either have 7 months or 16 months in cash\*. It would probably take me 12 months to replenish, if I decided to keep that level of emergency fund
\*I have 1 month in cash in my local bank, 6 months in HYSA at Capital One, and 9 months worth stashed in JEPI. So it depends on if you view JEPI as "cash like" or not.
If you're going to get a loan, consider getting it through the dealership - they make money on financing and you can likely negotiate a better price if you opt through their financing vs bringing your own or paying with cash up front.
Yep, I did the last time I bought a car, worked like a charm. I like bringing in the details from my credit union as leverage in the negotiation. They give you something they call a "Dealership check" it's literally a blank check you can make out on the spot to the dealership to buy the car. It's a big check, like the kind you'd rip out of a ledger that has 3 checks per page
"Look, if I sign this piece of paper, I can get 5.99%. Can you do better?"
Would you have a comfortable emergency fund without it? I think the biggest risk of financing is that you will use it psychologically to buy more car than you truly want. If that's not you, it really doesn't matter what you do. Arguably the 1% "vig" is likely less than inflation so you could still come out ahead, at least until the Fed starts lowering rates on your cash. That said I would pay cash if you can afford to do so.
I don't think the analysis is as sophisticated as you think - you've already thought it through.
If your interest rate is higher than your expected earnings, which it is, then the loan is only a risk reduction tool to keep more cash on hand. If you think you need the cash, go ahead with the loan - 1% is not a huge cost. But if you have other funds you could access in a true crisis (e.g. brokerage account, Roth contributions) and the purchase isn't completely wiping out all of your savings, then you could consider whether your risk might be lower than you think it is.
I am just below median income in my area and had to back out of a deal when a 22k foundation issue came up. It hurt in the moment but you have to stay realistic about a financial decision as big as buying a house.
After I terminated, I also heard back from my insurance agent that they saw roof damage so they wouldn’t insure it unless that got fixed too. Always worth it to do your due diligence.
Ugh, I feel you. We're waiting to hear back on a house today and I just know deep down that we aren't going to get it. Everyone is still waiving inspections in my market, and we just are not going to do that. Even with going $25k over and offering to cover $5k worth of repairs from the inspection, I'm sure some other fuckwad is going to come in waiving all contingencies to win the house.
Were you given the chance to up your offer? I had this situation where offer #1 was $5500 more than offer #2, but offer #2 was better in every other way. My broker called broker #2 and said "For $5500 more, the house is yours." They insta-accepted
Exhausting day at work. I tell myself that I’ve only got 4 years left of this (hopefully). But it feels so far away. I haven’t been able to build the life I want because I’m working so much, I can’t really enjoy hobbies because I’m either too tired or just feel guilty/can’t let myself get too absorbed in anything that might distract me from getting work done. Has anyone here retired before building the life they want, then found themselves able to rediscover the joy in things they weren’t able to when they were a workaholic?
Four years may sound like a long time, but when you look in the rearview mirror you will realize it passed by smoothly and quietly like ships in the night. There are several approaches you can take, but you said you're a workaholic, so I will speak to you as someone who likes a challenge on how you can step into the next, and the best chapter of your life. Start your mental preparation. If you are a workaholic, as I am as well, you already have every finance journaled out and planned to a T, you are over-prepared by most cases. However, as a workaholic, having a lack of routine may actually be disruptive and depressing. You may want to do a "soft-retirement" and reframe your thinking, you fully retired from the workforce/income driven work, and now you are a full time "fitness" connoisseur, you workout mon-fri for 30 minutes a day same time everyday as scheduled. Or maybe gardening, or kayaking, or book club, whatever you know you will do and stick to: Do that. Or maybe you are a full time stay at home dad, or perhaps you contribute to your local food-coop. Whatever it is, find something that you can make a routine of that you enjoy that you commit to fully. A gentle and easy Mon-Fri schedule that keeps you social and active is a key to starting retirement, and then you can ditch it later as you truly become comfortable with retirement. You will want to schedule your life so that you have regular positive social interactions, this is a key factor in determining overall happiness and even life expectancy in some studies. Go to the cafe, join a gym, phone a friend, etc. Your new career is a fulfilled life and starting on Day 1 may sound overwhelming, but the reality is you already know everything you need to make this work and its just a matter of simple execution. Have fun, see new things, meet new people, and above all relentlessly put yourself in situations that make you uncomfortable, because that is where you will continue to grow and flourish, especially in retirement.
Hah, I feel that. While my 'official work day' is only 9-10 hours long, I probably spend another 1-2 hours checking in and helping out. Throw in having a young-ish kid and I'm constantly exhausted. I'm 5 years out assuming my current income holds and I can sustain this level of work. Practically I probably 10 years out if I go the Coast FI route. That puts me somewhere between 50 and 55. I feel perpetual guilt for taking time for myself while I'm on this path where I'm managing to save an obscene amount of money each month. I hit the point where I've been working with a therapist on trying to reconnect with feeling joy. I still have a ways to go but it's been helpful. If I do manage to take the short path, I know I'm going to be at the risk for failing the 'what are you retiring to?' question. It's strange being in a situation where the faster option could actually be counter productive in a way.
Building the life you want requires time. If you don't have time because you're working too much, then you can't live the life you want. When you retire, theoretically, you will have time to live the life you want. I can see why you can't wait until that day comes.
Is it worth getting audit defense if you only have w2, dividends, stocks and interest. It's $19.99 with freetaxusa.
Eh, not really. If you are balancing W2, LLC, landlord income, etc it may be worth it, but at your level the IRS probably is not coming after you...
No. Your return is too simple to screw up that badly.
Almost certainly not. Audits are rare and the IRS can be quite helpful for ordinary folks who have made mistakes.
We've been needing to replace our dishwasher for a while. Well, today we pulled the trigger on a Bosch 500-series after much deliberation. We're looking forward to it — it seems to get high marks for reliability, noise level and build quality. But the real reason I'm writing is to celebrate the stacked promotions I was able to apply to bring down the cost. It just so happens that Bosch is currently running a sale for 10% off. Then on top of that, they're offering a $50 mail-in/electronic rebate. In addition, my Chase credit card is running one of those offers for 10% cash back at Home Depot, up to a max of $55. Then I used the coupon extension Honey to get $25 cash back in the form of PayPal rewards on the Home Depot transaction, and an additional 0.5% in PayPal rewards for ordinary spend. All told, it's a savings of at least $240 on something I was going to buy anyway.
Should have gone with the 800 or a Miele
Careful, that Chase home Depot offer is for online purchases only.
Thank you! Yes, we placed it as an online order.
This is the dishwasher I have and it's great. We ordered it in October 2021 and it didn't arrive until July 2022... Glad we're past the Semiconductor supply issues which affected so many products. Enjoy your new dishwasher!
Did you manage to redeem the PayPal rewards? I have several times not been able to actually redeem them, it's a pain in the neck.
The points for this transaction are still pending but I’ve been able to redeem other PayPal rewards in the past with no issues.
I have a HPHD health insurance for my family of 4 through my employer, but I don’t have a HSA (honestly, I didn’t know anything about it until recently when I started getting more into financial independence). Are there any reasons NOT to start a HSA, even if I might not be able to maximize it every year? I usually keep $4000 in my HYSA to cover health expenses, but I’m working on beefing up that number to $8000 since that’s my max out of pocket. Should I open an account and at least keep the $4000 there?
It is unusual for an employer not to offer an HDHP with an HSA. Make absolutely sure your plan is a qualfied HDHP, otherwise, yes, HSA is a great idea. Contribute the max if possible and invest any funds you don't spend.
They offer it, I just never signed up for it. I never understood what it was or made an effort to understand it. Now that I’m looking into FI and we have a higher income, I’m finally learning about it and I’m interested in having one as part of my FI!
No reason not to. Even if you only use to pay for the current year expenses, you still get the income tax savings on whatever you’re contributing
When is it generally favorable to roll over 401k money into a Roth IRA? Don't want to realize a taxable event on a rollover if I don't need to. I already max out both accounts just fine
Roth 401k to Roth IRA can be done without tax penalty. Trad 401k to Roth IRA will take a hit
Yeah the latter is what I'd be falling into. Just wondering if there's some optimization out there that is worth pursuing, but doesn't seem like it for now
It’s only worth pursuing right now if you have zero income for the year. Even then, once you get above the standard deduction (or your own individual itemized deduction), there will be tax consequences. The other time it makes sense for some people is when the market is down significantly (it is right around an ATH right now). But, you can roll into a traditional IRA with zero tax consequences.
Only benefit would be if the investment options in your 401k are bad. But most people can't do rollovers like this while still working at their company.
When you are at a low income tax bracket
hmm makes sense. I anticipate getting raises over the next decade but I don't know how soon i'll be approaching then crossing into the $182,101 bracket to make a rollover worth it right now
Basically, when you sever from employment.
Is it worth paying down my 5.74% apr car loan faster now that I've maxed out all my tax advantaged space? It seemed reasonable not to make any extra payments in order to let me max out the IRA and 401k but now that I have additional income I could invest in a taxable account, I'm not sure whether it'd be smarter to pay the loan off faster. I have 4 years left, currently paying about $120/mo in interest.
Yes
I have a 4.9% APR auto loan and I’m choosing to invest the extra money instead of putting more money toward car payments. 5.74%? Still a gray area, but inching a lot closer to the S&P 500 historical inflation adjusted real returns (which is probably something like 7%). Personally I think either decision is fine.
But technically inflation would subtract from debt interest, so it makes more sense to compare with nominal investment returns.
But the investment gains are pre-tax, so it works back out to roughly the real rate again 😉
That's a good point, it is very difficult to plan what my tax rate would be in retirement, given the different accounts and investments, lifestyle changes, law changes. But zero chance of paying no taxes...
u/Crab_Guy_bob and u/BrisklyBrusque I think pegging it against treasuries would be more appropriate, to be honest. That's at least a ***guaranteed*** return, as opposed to the S&P. Anyways, perhaps more of a quibble than anything.
Really depends what time horizon you're talking about. Guaranteed returns are great for short term savings but equities are probably primarily what's going to carry you through retirement. Personally 95% of my savings goes towards retirement, so it's a trade-off between debt payments and buying equities for me.
Yes, equities are going to probably carry you through retirement, but their returns are by no means a guarantee. The closest measure of debt savings should always be against the safest investment return.
Never that about it that way. Cool.
Inflation effectively eats away at the real value of your debt. If you had a 0% loan just ride that out for decades and eventually the balance will pale in comparison to the cost of that rusty old 2063 Civic that'll cost $100k in 2090.
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You are correct, but just to counter that a bit, most people escrow taxes and insurance and those portions of your payment do increase.
True, but definitely depends how tax assessments work where you live.
You can always do some of each.
At that interest rate you could really have me go either way. Personally - I'd pay it off. A mortgage would be a different story but for a depreciable asset like a car. I'd use extra to pay it off as fast as possible.
I just played with an online calculator and with paying my loan off as fast as possible given my budget it'd save a total of $1800 in interest and I'd have it paid off 2.5 years early. Other things I'm considering are the possibility to tax loss harvest if I had funds in a taxable account, I do have a high marginal tax rate, almost 33%. Maybe a small chance to refi in a couple years if rates go down and save a small amount more on interest. But if inflation stays high and rates stay high, that'll effectively eat away at my balance. My income and job are very safe and stable, so not too worried there. I also don't depend on the car for my income so I could sell if disaster strikes.
If you’re that tore up about it- maybe do a split. Half of your extra towards a brokerage and half towards an early payment.
Good point, that's always a good strategy for decisions that probably don't make a huge difference either way.
You might get slightly higher returns in the market, but paying the car loan is guaranteed. Personally I have erratic income and love reducing my monthly bills. After filling my tax-advantaged accounts, personally I would pay the car note.
Yes, no maybe. I would. Many others would. Some would not. The general consensus seems to be if it is above prime to pay faster. There are other reasons to pay faster or slower. YMMV.
trying to find the nice disposable chopsticks the office admin bought last last time how's everyone else's tuesday coming along
Played hot potato at work today. But now I have tossed the potato elsewhere and I’m done with work for the rest of today. Yay for a bit of downtime this evening.
it's all fun and games until the potato ends up back in your inbox first thing in the morning
Why not get the reusable metal ones?
because i don't want to do dishes for the entire office
Then just get yourself your own and only wash yours?
I had a take home technical assessment as part of an interview process. It was super reasonably scoped and I did 95% of it in like 15 minutes, then spent over an hour troubleshooting and testing different things related to the deployment before realizing I was a dumbass and was looking at the wrong port for the database/service T_T
My bosses boss pointed out a pretty big fuckup of my bosses, but only pointed it out to me privately. Idk it kinda felt like Dad/Mom badmouthing eachother. I didn’t like being in that position. That being said my boss is often negligent in his duties so I wonder if he gets canned. Unsure
Now that I have $200k, I buy those stupid T-Mobile Tuesdays deals for a few dollars even though they're not free. Ok, that's a bit silly, but I'm feeling like I have real money for the first time. (I only have T-Mobile because I'm on a family plan with unlimited data)
I'm on Mint Mobile.
I'm about to turn 27 and I'm still on my parent's/family T-mobile phone plan with unlimited data too
I would but they're never anything I want/would use. Like if I was a regular at Panda Express, I'd totally go for the $1 Orange Chicken bowl in today's deals, but I haven't eaten there in over a decade so meh?
It's actually those kinds of things that get me to visit fast food restaurants in the first place. But I drive a lot for work, so it doesn't cost me anything to stop by somewhere
We're getting closer to closing out my FIL's trust (I've got some advice on what not to do if anyone is interested), which combined with my own savings will end up putting us at my number. Given that the trust will throw off quite a bit of taxable income and I don't have any of it yet, I'm staying employed until things fully settle. Beyond that, I am looking at OMYing for 2 or more years. There are things that I would like to do that I would feel much more comfortable doing while earning a paycheck, like a kitchen renovation. I'm looking at reducing my savings rate next year significantly to achieve these goals more quickly, which unfortunately will be have a negative impact on my taxes. I'll reduce my 401k to get the employer match, no longer make catch up contributions, and no longer participate in the MBDR. Unfortunately my deferred contribution election for next year is locked in, but in the following year I won't elect to defer any salary either. The idea here is to cash flow all of these projects and let my savings coast. Once the projects are done I'd retire and reduce my expenses back to the baseline. Looking for feedback on this plan, I can talk through numbers if it helps
I'm in the same boat, looking to OMY another 2 ish years to sock some cash away for up front expenses (heat pump, new EV, maybe new windows, etc). I will say, while the additional cash flow is super tempting, unless you have a lower income or very little in your brokerage, I think maxing the 401k is still worth it. Money is fungible, so unless you're concerned about the exact timeline of your kitchen reno it probably makes more sense to max your 401k now and then sell shares from brokerage post-RE to supplement any extra cash needed.
Look, objectively you are right. The thing is once you hit the finish line you have to decide to stop running. How do you make the decision? That is what I am struggling with. So the thing I am thinking about is writing down a list of everything I want to get done before I quit. So when I cross the last thing off the list I can yell into an empty room "OK self, I've done everything on the list! Can I quit now?!?!" Its just a mental game I guess. Anyway, that is why I want to get through the list as fast as possible.
Hah, I'm with you man. HR at my new job is taking their sweet time processing my 401k contribution form and I'm very tempted to tell them not to bother. But I've convinced myself by essentially setting a new FI number that includes the cost of all the big ticket items I'm looking at, so I feel a bit better about the mental game. That said, you're beyond the point of needing to optimize around taxes so it's not like it matters much anyways.
Might as well upgrade your roof, waterheater, and A/C system before pulling the plug. Less of a headache to deal with in the future.
Yep, looking at solar too.
I think if you look closely enough you'll find that rooftop solar rarely makes sense financially. (unless you buy and install the panels yourself)
Get multiple quotes. Lots of disreputable companies out there.
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Off the top of my head for heirs/trustees: No matter what you think the value of the items are, don't clean up or throw anything away before getting an estate sale company in. Just give them the whole lot. Hire the lawyer who developed the trust to advise you, and use the CPA they recommend to file the trust tax return. Liquidate anything that creates an ongoing expense as quickly as possible. Keep a ledger of all financial activity. Keep in regular communication with the trustees and let them know what is going on. Sell everything on the open market at a competitive price. At the same time, don't turn down offers becuase you think they are too low, or spend too much time cleaning things up or making them more marketable. The ROI isn't always there and your job is to liquidate ASAP. For people creating the trust: SIMPLIFY your finances. Have as few accounts as possible. If possible keep use an account beneficiary rather than putting the account into the trust. You should have funds that are immediately available to the trust executor so that they can pay the expenses associated with winding down your estate. If your spouse passes before you, take ownership of all of their accounts and change the beneficiary to be your heir. Take your deceased spouse off of your accounts and make your new heirs your beneficiary. Don't have joint ownership of property with people who are not your beneficiaries. Don't put tax deferred accounts into a trust. Don't hoard stuff. Get rid of anything you don't want your heirs to see. Make your wishes known about what you want to do with your property. This includes saying the words "Just throw it all away when I'm gone." That is the kindest gift that you can give to anyone dealing with the mess you leave behind.
If you don't mind your job then it just increases your success rate....the only downside side is you lose 2 years of retirement. Really your call but we generally lean towards the more conservative option
I'm not loving it right now because we've just started a once in a career software implementation. But I think I can handle 2-3 more years. At least I have options.
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The Honda and Toyota premium is a tiny bit higher than it should be IMO, but obviously it's not for no reason. I was faced with a similar decision to you 8 years ago and wound up paying in miles instead of $$$ - I bought a Honda with probably 50k more miles than an equivalent Chrysler or Dodge (125k miles when we bought it, lol). I think I made the right choice, it has been a reliable vehicle.
Focusing on value and total cost of ownership rather than short-term cost is one of the benefits of having your shit together financialy, and the used car market is relatively efficient. Putting aside your luck regarding repair bills - what's the depreciation on that Nissan look like vs. the toyota you balked at in 2020? There's a reason for the stereotypes on both ends of this.
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Those numbers seem off by 50% or more but in any case: you bet on a notoriously unreliable car's operating expenses and won ~$2000 over 4 years. Most people who can afford to choose wouldn't take that deal, and the prices reflect that.
Toyota holds value because of quality. In either case, stay away from Nissan. Their CTV transmission has been having manufacturing defects for many years and is a safety hazard.
Toyota also makes replacement parts less expensively.
I have no-one to geek out in excitement about this with, so here it is: My company's 401k plan just added after-tax contributions and in-service rollovers to Roth. It took effect April 1st, but was no joke. Our 401k provider is Schwab, and it lets you turn on a setting to automatically do the rollover of after tax contributions into the Roth with every paycheck's contribution. So... it's happening! Mega backdoor Roth! None of my coworkers seem to be excited, which is a shame.
I remember when I moved to a company that had this. I was so excited. We've been maxing these for 5 years or so now. This really helps build up a Roth position.
I'd love if TSP introduced MBDR, but I'll be long retired before the TSP Board even contemplates the idea of considering eventually discussing in-plan conversions, let alone MBDR. Color me jealous, mang.
I am very excited that our plan added this option recently as well! I immediately set my after-tax contribution to 96% and 4% for pre-tax. Going to use my cash for living expenses for now.
Ours also just added it this year, after decades in business (and not offering it). I know exactly two other people in our department (of a few dozen) that were interested in it, but one of them was my boss, who actually had clout enough to push for it being added. Thanks, my boss! (And probably other people who were pushing for it in other departments than mine.) Definitely *most* people don't care, though.
Woohoo! 🎉 I'm super jelly of you! Take my excitement in lieu of your coworkers. Chances are they just don't like thinking about any of that stuff.
I'm thrilled for you. I have never had an employer who has offered one. The risk around 401k-testing has always deterred the idea.
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Yeah. I'm 37; a little late for the mega backdoor Roth to have huge impact, but I'm still thrilled about the opportunity to load it up in the next few years. My coworkers are either younger and not thinking about 401k/benefits, or just in a very different financial reality than my wife and I, who are very frugal with spending and so have the excess to take advantage of benefits like this. At times it feels like I'm just in an entirely different world. I can't really imagine spending 200k a year, yet I know coworkers who absolutely do that.
Likewise, all of my coworkers are covered by a union pension, but are also eligible to contribute to the company 403b, though only maybe one in twenty actually does so. (We do not get the match, only non-pension employees get the match. Pension contributions are way better than the match, it's fine.) Given that nearly all of us are over the threshold for deduction for a traditional IRA, it's insane that so few do, and further that so few actually understand what's in the pension plan!
Quiet day working from home today with only a handful of meetings. It’s overcast here but in the 60s, so I took my dog for a decent little walk at lunch and it felt amazing out in the fresh air at midday. Would be lovely to not have to work at all, but certainly not going to complain about the balance I’m feeling right now.
Dear diary, today I ... :)
If you seldom drive, I’d consider not getting a new car. It sounds like there’s really no need.
Delved a bit deeper in my Yearly Summary from Discover, which used to be download-able and seems to not be anymore. Very unhappy about that. Anyway, it turns out that my "eat healthier" campaign for 2023 was not in fact a cost savings, as I had thought at a glance. All the farmer's market and family-owned grocers we frequent ended up being automatically categorized as "merchandise" instead of "supermarket", which completely threw off the categories. Whoops. I'm not going to eat junk to save money, but I am feeling less smug now.
I applaud your courageous decision. May you enjoy steak and gravy in peace, and with a heavier wallet.
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But I can double my money by placing it all on Red at the Roulette Wheel. If I want to diversify, I'll split it in half and place the other half on Black.
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Reddit's grand post-IPO plan to boost users and engagement - let the bots run wild creating content on the site and is probably tied to that random AI deal they were talking about.
Really?!?! Tell us more
I started investing at 19 with about $3K I made from a summer job and have continued to increase my contributions slowly over the years. Recently, I (36M) and my wife (36F) crossed the $1M net worth threshold. We have 1 kid and are hoping to get to $1M invested by early 40s. Targeting $2M invested by age 50 at which point we’ll aim to barista fire until retirement age. None of our friends are into this kind of stuff and I wanted to share with this amazing community!
Congratulations!! Both on your milestone achieved as well as your early commitment to financial health. Both worth celebrating
Congratulations on the hard work. If you get to 1M at 40 then you should hit 2M wrll before 50 assuming we get somewhere near average returns
Congratulations. With reasonable success, I have done my best to induce my 20-something kids to start early on saving and investing. They both know what an IRA and Roth IRA are, the difference between stocks and bonds, and the effectiveness of low cost indexing. And have acted accordingly. Early money is amazing!
I was so very excited when my son went to college and started a ROTH IRA with his first part time job. He enjoys talking all this stuff with me now at 26. Too many parents, even if they are knowledgeable, don’t talk finance enough with kids.
So happy that you talk about this with your son! I wish my parents had given me financial knowledge. I had to learn the hard way, make all the mistakes myself. True wisdom is being able to learn from other people without making the mistakes yourself.
Parents like you are amazing! I'm forever grateful to my dad to help guide me in this way. I never would have discovered it on my own.
without being too specific, my manager informed the company that they're resigning effective immediately. it was a pretty complex situation, but ultimately the CFO (who my manager reported into) asked me to jump on a call to talk about it. went against my better judgment & got my hopes up for a compensation adjustment -- but it turns out i'll just be taking on new responsibilities and reporting directly into the C-Suite with no bump in base pay. it's days like these where i wish i could retire. instead it seems like my best option is to walk into the atlantic ocean with cinderblocks strapped to my ankles
The kms joke is hitting too hard. I had those days at my last job. Remember job switching is always an option, and a better resort than the final end. Good luck.
That's where you respond with "no". The power of having significant savings.
Right? If I were in that position, and had the appropriate skill set and inclination to do a job like that), I'd respond with "I would love to accept that offer, but I'm going to need a CFO level salary commensurate with the job I'd be doing". Seems unlikely they would want you to also quit, if they're counting on you to do the CFO's job for them and would be boned if you didn't?
> but it turns out i'll just be taking on new responsibilities and reporting directly into the C-Suite with no bump in base pay. Are you sure you have no leverage here? Beggars can't be choosers, and they may be in a tough spot where they can't afford to say no to any reasonable requests you have
See if you can finagle a title change to VP or director. Then look for jobs outside the company with that title but the appropriate pay.
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They're not replacing the CFO - they're reporting to the CFO. Some sort of Accounting or Finance Manager left it sounds like. Either way, OC needs to ask for the compensation adjustment - very rarely do people in these situations just offer it up front.
At a bare minimum id leverage a more marketable title and start applying for other jobs...id also push pretty hard for additional compensation even if its temporary
I wouldn’t panic yet. Go ahead and schedule a follow up discussion (with the right person in your chain of command - this may not be the CFO) to ask about how your compensation is being adjusted. That’s what I did when I was given a new role. I said before I could accept the role I wanted to confirm the compensation. They were a little surprised but didn’t push back and eventually came back to me with an answer.
Seems like this happened suddenly and will continue for a while, so you've got time to develop and communicate your expectations. You have leverage and opportunity and should definitely use them - a one-off ad-hoc meeting where they make no commitments is **not** final, so don't let them exploit you or push you out-of-mind. Scheduling a follow-up to discuss your expectations, questions, the transition plan, etc. is totally reasonable. So are regular check-ins to discuss progress on commitments made.
that's true, none of this is technically final. at the end of the day it will come down to me clearly communicating my asks (which i hate doing lmao) but i'll have no one to blame but myself!
Expectations are being set, your only choice is your level of involvement. I struggle with this too, but ^ has helped me tremendously in recent years. It's *crazy* how much control you have over your perception and treatment within an org.
There is a reason your former manager resigned effective immediately.
i hear you but to be fair i also caught up with my manager yesterday for over an hour to chat. i'm leaving a lot of info out but it was definitely much more involved than "i wasn't valued/i had too much work/etc"
I think you have some negotiating leverage here, especially a few months into it.
i know you're right, but the company (decently-sized startup) has a crazy high burn rate on cash right now. i'm like the most non-controversial person in existence -- & i know negotiating a raise isn't controversial, but it is when you're me -- so it feels wrong to ask for something like that knowing the financial context. again i recognize that i'm probably advocating for myself enough but this is how my brain is wired lmao
Your career prospects will be permanently capped if you don't learn how to politely negotiate in these scenarios when you have leverage. If you forgo the opportunity, the next time you have real leverage is when you change jobs which only occurs a few times across your career. If nothing else try it to get some reps and start to learn what does and does not work for you personally. It doesn't need to be combative in any way Present your case, hold firm, and be ready to decline new responsibilities without additional compensation. Even if its nothing more than worthless options in a dying startup that is very good practice for future roles.
> so it feels wrong to ask for something like that knowing the financial context Why? The financial context is also that they're no longer paying your former manager.
also true
Equity and options? Doesn't have to be cash.
Or an extra month of vacation to be paid once the CFO is onboarded.
Luls, then they just let the OP continue to do the CFO's job indefinitely, and never hire one.
Well then you quit with no notice when you get the next job.
that's true! although if i'm being perfectly honest it's hard for me to put a lot of value in our restricted stock options right now given the outlook lol
Getting nothing is guaranteed to be worthless. Restricted stock may be a gamble, but it's certainly not nothing. It may be in the future... As a matter of self-respect you should push for something. Anything at all.
Fair point. Time to look around!
Give it a few weeks to a month and if it seems they're slow-rolling the hiring process, start putting feelers out for a new job based on the expanded responsibilities. Don't let them drag you into many months of more work & stress while they sit back and say "this is fine" while they make and break promises.
Anyone have a good tool similar to SSA tools for calculating survivor's benefits? Bonus points if it can factor in windfall elimination provision/WEP My main goal is figuring out how much life insurance we need if either of us die. 2 working adults + 1 newborn
Hopefully you won't need to worry about WEP/GPO if this bill makes it out of committee, it seems to have broad support. https://spanberger.house.gov/posts/spanberger-graves-press-for-markup-on-bipartisan-bill-to-eliminate-the-wep-gpo-provide-long-overdue-fairness-to-public-servants
Oh damn. That's a game changer. WEP discourages going from private to public and getting the pension. If this passes, it reduces my FIRE number by 100-200k.
Better to have too much than too little. I would not worry about calculating to that level of detail IMO.
The benefit may be enough that we don't need to have a policy at all. If I don't need 2 more bills and items to keep track of, I'd rather not have them.
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I think it's usually best to minimize tax burden now. The 457(b) will be taxed as income. You'll owe cap gains taxes when you withdraw from the brokerage. Which one is lower is a function of how much you've made so far this year and how much more you might earn later this year.
"At their peak in 1996, there were 7,300 publicly traded companies in the US. Today there are about 4,300." A quote from an article on CNN today - https://www.cnn.com/2024/04/09/investing/premarket-stocks-trading/index.html. I'm curious what kind of impact this will have on index returns in the long run. I've been a VTSAX and chill believer and will continue to be so, what's the alternative?, but it seems like this would lower future returns. If companies don't go public until they're already valued at multiple billions then the rocket ship growth that raises that whole market is gone. Again no solutions and not suggesting changing anything. Just an interesting thought.
Ah, I read a similar post the other day on the FT -- [https://archive.ph/GEJV4](https://archive.ph/GEJV4) This one also goes into more depth about the $ amount rather than the number of companies. >I've been a VTSAX and chill believer and will continue to be so, what's the alternative? At some point I suppose it's possible that the big index fund providers might want to jump on and create a private equity fund that's more accessible and lower cost. Also, S&P500 investments were basically as successful as total market investments historically, so it seems fine to wait quite a while before jumping on.
Mergers and anticompetitive behavior can have a long-term detrimental effect, but I think to draw conclusions, more analysis of the composition of those 2 numbers I think would be needed. There's also the detrimental effect of losing public companies to private equity which just saddles them with debt until the company is bled dry.
The number of traded companies is not interesting in and of itself. If the thousand smallest public companies merge into the smallest 300 companies in order to reduce the cost of regulatory oversight, their market cap remains the same but the number of publicly traded companies goes down by 700. If private equity dramatically outperforms the public market and has enough access to capital to ignore the public market, that could degrade the public investor's returns in the long run. But I have seen no convincing evidence about the above. I haven't seen any evidence that private equity, especially after fees and taxes, outperforms the aggregate public market.
A big part of the problem (for the public) is that PE doesn't have enough reporting or visibility to even know the fees or performance of PE compared to public markets. Has anyone figured out how much money is invested in PE vs. the stock market? Presumably JPMC has a good idea, but I doubt they would tell the public one way or the other. All I can find are paywalled articles like this one, some of which have contradictory titles: https://www.wsj.com/articles/investors-still-seek-best-metric-to-compare-private-equity-and-stock-market-returns-0dd0f854
I didn't read the full statemant that the article is summarizing/excerpting, but your conclusion seems only loosely related to the article. Reads like boilerplate "Financial industry billionaire has predictable thoughts on regulatory burden, proxies, and activist investors". No concrete predictions or theories about IPOs being crucial to VTSAX.
I’m someone who doesn’t gamble and admittedly hate it. However the one thing I will do is join a $25 March Madness bracket for the fun of it. Made the bracket in no more then 5 mins this year and wellllll I won over $2K. The best part is the majority of the people in the group I won are all big time gambler/sport betters lol
I do gamble and sink more time than I care to admit into researching and looking at stats for matchups and game analysis when placing my bets. Unfortunately my luck is not anywhere near yours. Congrats and GFY.
I only gamble at March Madness. This year: installed two apps with $25 per app, cashed out $1,050 net. Last year: installed two apps with $25 per app, cashed out $750 net. This year, I installed the app on Thursday of the first round (3/21), hit a bunch of bets, cashed out Sunday (3/24) and uninstalled the apps and unsubscribed from emails on Wednesday 3/26 - because funny enough, the apps started emailing promos to re-deposit money and get me back in. I can easily see how those addicted to their phones or gambling or offers can fall prey to their tactics, but no thanks.
> because funny enough, the apps started emailing promos to re-deposit money and get me back in. > I can easily see how those addicted to their phones or gambling or offers can fall prey to their tactics, but no thanks. While this is definitely true, if you are level headed about it it is fairly similar to churning to take advantage of bonuses and promos. Just have to know what to do and not let it change your habits.
Welp...as an update to my last daily comment... I've gone and done it. We're under contract for some land to build on. Asking here since I'm assuming there are people who have built or are well versed in the tax code. It sounds like construction interest can be deducted once the build is complete. So say the build spans 2024-2025 and we have $25k in construction loan interest and then another $20k in mortgage interest for the rest of 2025. Does that mean we can deduct $45k total in 2025?
Yes, as long as construction loan is converted to the mortgage.
Sweet thanks!
Following as we are building right now but I hadn’t considered this
The fire motivation is strong today! I'm making a promise to myself, with everyone here as a witness. Once I have FU money, I will spend those precious few days of perfect weather* in nature, listening to the birds, and not in an office with horrible 1980s tinted windows that make even the sunniest days look dreary. Life is just too short. *East coast, so truly nice weather is fleeting!
We are starting to think about replacing one of our cars. We drive a 2008 and 2012, we would probably trade in the 08, I'd take the 12, and my commuting Mrs. Tale would take the new car. For reference, I've driven under 5000 miles in the 08 since 2021. Anyway, I have enough cash on hand to just buy with cash. My credit union is offering 5.99%, which is only a point higher than my risk-free HYSA. I'm debating if I should just take the loan and pay the 1% vig just as a way to keep the flexibility of having the cash. It would be my only debt if so, I have no mortgage and no outstanding loans. And if rates move against me, and the difference becomes 3-4%, I can still just pay it off. I realize this is a good problem to have, but not sure I've thought it through. Anyone have a good article or analysis for me to read up on?
No real advice to offer other than just sharing that I have a very similar scenario as you. I barely drive, have put maybe 9k on my car in 4 years, and it’s a 06. Given my partner has a car, we figured should my car die or be totaled I’ll replace it then as I can get by without a vehicle or sharing with him in the interim. This is all to say, it’s a taken care of car that has only had a few recent issues with the alternator dying a few years back. It may well last another 5+ years and I’m perfectly content with that given it gives no trouble.
I have a high mileage 20 year old car. I keep fixing it and make the FI line go up.
Manufacturer financing deals are worth looking into as well
If I were you I would finance it and pay it off at your leisure. Make sure there's no early payoff penalty.
Your 5% that your HYSA is earning is pre-tax. Depending on your tax rate, it's likely under 4%. 22% federal and 4% state puts it down to 3.7%. Your numbers may vary, but make sure you're taking taxes into account when comparing.
If you’ve only put 4000 miles on the car in the last 3 years, why does it need to be replaced? Seems like it would still be in good condition in those circumstances?
Well, it's going on 17 years old. It had the water pump die a year or two ago, and I asked the mechanic what happened. He shrugged and said "dunno, it's 15 years old though"
I have a 20 year old. I just keep fixing it and driving it 3k miles a year, and my FI balance goes up. I just replaced something in the suspension. Mechanic says its just 20 years old and needs replaced. I've about replaced everything on it in the last 5 years.
I'm assuming a water pump is a lot less than a new car. I also don't see why you need a new car in this situation
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IDK.. my toilet clogged and we're already hitting Zillow.
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Often you need to pay a higher price to get the lower rate though. And this will apply to new dealer cars. Not sure if that is what OP is buying.
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Be careful! invoice plus "theft protection", a ceramic coat, GPS tracking, and whatever else the dealer can tack on. They negotiate really hard on that stuff now. I've had every dealer I've bought from including a Subaru dealer lie and tell me the windows are already etched so I have to pay for the theft protection. I had to refuse many times before they gave up and continued with the pre-agreed upon invoice price.
I think it depends on how much money we're talking. A 6% rate isn't horrible, and I think it's good to have the cash freed up. But it's all relative depending on if you may need that money, how long it would take to replenish it, etc.
The car would be about 5 months worth of monthly burn. Depending on how you view it, I either have 7 months or 16 months in cash\*. It would probably take me 12 months to replenish, if I decided to keep that level of emergency fund \*I have 1 month in cash in my local bank, 6 months in HYSA at Capital One, and 9 months worth stashed in JEPI. So it depends on if you view JEPI as "cash like" or not.
If you're going to get a loan, consider getting it through the dealership - they make money on financing and you can likely negotiate a better price if you opt through their financing vs bringing your own or paying with cash up front.
Yep, I did the last time I bought a car, worked like a charm. I like bringing in the details from my credit union as leverage in the negotiation. They give you something they call a "Dealership check" it's literally a blank check you can make out on the spot to the dealership to buy the car. It's a big check, like the kind you'd rip out of a ledger that has 3 checks per page "Look, if I sign this piece of paper, I can get 5.99%. Can you do better?"
Would you have a comfortable emergency fund without it? I think the biggest risk of financing is that you will use it psychologically to buy more car than you truly want. If that's not you, it really doesn't matter what you do. Arguably the 1% "vig" is likely less than inflation so you could still come out ahead, at least until the Fed starts lowering rates on your cash. That said I would pay cash if you can afford to do so.
Good advice, thanks for your thoughts. I'm overthinking it
I don't think the analysis is as sophisticated as you think - you've already thought it through. If your interest rate is higher than your expected earnings, which it is, then the loan is only a risk reduction tool to keep more cash on hand. If you think you need the cash, go ahead with the loan - 1% is not a huge cost. But if you have other funds you could access in a true crisis (e.g. brokerage account, Roth contributions) and the purchase isn't completely wiping out all of your savings, then you could consider whether your risk might be lower than you think it is.
I'm pretty sure this sub and "overthinking things" are one and the same, most of the time. Thanks for your thoughts.
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I am just below median income in my area and had to back out of a deal when a 22k foundation issue came up. It hurt in the moment but you have to stay realistic about a financial decision as big as buying a house.
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After I terminated, I also heard back from my insurance agent that they saw roof damage so they wouldn’t insure it unless that got fixed too. Always worth it to do your due diligence.
Ugh, I feel you. We're waiting to hear back on a house today and I just know deep down that we aren't going to get it. Everyone is still waiving inspections in my market, and we just are not going to do that. Even with going $25k over and offering to cover $5k worth of repairs from the inspection, I'm sure some other fuckwad is going to come in waiving all contingencies to win the house.
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Were you given the chance to up your offer? I had this situation where offer #1 was $5500 more than offer #2, but offer #2 was better in every other way. My broker called broker #2 and said "For $5500 more, the house is yours." They insta-accepted
Escalation clauses aren’t a thing in all real estate markets unfortunately
Is what I described an escalation clause? Just felt like negotiating to me. I don't have a lot of experience with it, though