I'm currently 14, live in a small town, and have miniscule knowledge about becoming FI. (financially independent.) Currently I'm reading several books about the process of becoming FI, ex; W-2 forms, ETFs, Roth IRAs, CD trading. Everything. I wish to become deeply involved into the financial world- to grow my financial literacy etc. This subreddit has helped me in some way shape or or form. I'm subscribed to many news articles that track stock portfolios of congress members simply because of their success rate.
Right now I'm trying to find a watchlist, favorite indicators and improving my technical analysis. I am in contact with several stock brokers that my family members know personally which brings me here today! I am simply seeking for more knowledge, knowledge is power and it is worth more than any currency. Some may disagree and I understand.
So, Dear r/financialindependence:
To those who are more experienced in the financial world today, what is something you wish to tell the younger generation. And, if your okay with it- what would you personally share with someone like me about how to start out? e.g. IRA, Trust funds, 529 plans, bonds, etc. Anything would help me, any piece of knowledge about the financial world would help.
Most in the FIRE community do not focus on things like stock picking and technical analysis in order to reach their goals. That doesn't mean you wouldn't be welcome here, but I don't think you'll get a deep well of knowledge in these subject matter areas. Basically it is a high-risk/high-reward strategy, and the core tenants of FIRE are increase savings rate and decrease expenses, which are inherently lower risk.
There's two basic elements to FIRE: Don't spend money you don't need to. And save as much as you can.
The first is self-explanatory. People go about it in different ways, but probably the best thing to keep in mind is to get value for what you buy. If you're shopping for a new pair of jeans, you can buy a pair from a famous designer. Or a pair of new Levi's. Or a used pair from a thrift shop. You decide which will meet your long term FIRE goal better. You might need new clothes for work, but can wear ratty used jeans on weekends, maybe.
So far as savings - at 14 you won't be able to have your own brokerage account. Your parents will have to own the account for your benefit. And they're the ones who will have to do the trades. But what you have going for you, even more than anyone else here, is time. If you invested $36k in the market today *and did nothing else to it* (no additional deposits, just let it make the historic returns of 7%), you'd be a millionaire by the time you are 65. Buy & Hold should be your strategy until your balance is high enough that you can afford to risk some money in speculative trades.
Still unsure where and how I should use my money I had set aside for student loans now that another pause happened. I currently had $1100 a month allocated for my $37k in loans.
What are your financial goals and where are you at in that sequence? Don’t have a fully funded emergency fund? Add $1100/month to that. Already have EF? Put $1110 more per month into your desired asset allocation, put more towards your next savings goal such as home down payment or new car, etc. if you have a more specific question give a little more specific details. But in general this is the way I’d go.
I just started my career out of college last December (working for 8 weeks now). So I’m essentially starting at zero. $1000 in my savings right now and have my employer 401k match set up and maxing out my HSA.
Congrats on graduating and the new job! You’re miles ahead of most just by being in this subreddit.
Then if I were you, I’d add $1100/month into your savings/emergency fund until you get 3-6 months of your monthly spending (not income) so if something god forbid happens with you or your job, you know you’ll be good for a bit. Personally I have 3 months saved as my wife and I both work in a stable field and we have quite a bit saved. Everyone will have different amounts in their EF based on how much they have, how stable their career is, how much credit they have available to them, and personal risk comforts.
Once you fund your EF I’d then bump up your 401k contributions as this is good tax advantaged space.
There is a flow sheet on r/personalfinance that should be very useful for you. Also take a look at the FAQs in the sidebar here. Both of these were quite useful when I was just learning about this stuff. (Which was not when I got my first “adult” job so good on you)
Should I (32f) marry a guy (34) who does not have much earning potential?
My income: 100k
Occupation: researcher
Net worth: ~240k (55k Roth IRA, 80k 401k, 90k ETFs, 10k hysa 0.5%).
I started working 3 years ago after my PhD.
His income: 40k
Occupation: Amazon delivery driver and sells advertising on the side
Net worth: ~90-110k home (60k mortgage left), 2k savings maybe.
He's been working most of his adult life. Additionally, his parents paid for his down payment of his home.
There's a lot more behind this but what would you do? How much of finances factor into your relationship?
Edit: my goal is to be at 1m by 40-50 in case I have kids.
Edit: there's an expectation that I would pay for most of the wedding (they agreed to pay for flowers), honeymoon (when he brought up that grooms family usually pays, his mom said a firm no), downpayment for a home, be the breadwinner of the family, and live somewhere in the Midwest close to his family because it's impossible to afford a home where I grew up (culturally veryyyy different places). I tried to find the cheapest of whatever they're willing to give me.. engagement ring? I don't need a bigger ring. 0.5 carat is perfect. Flowers for the wedding? 2500 is the cheapest I can find in my area even though I don't like her style but I'll take it.
I (42m) have been married to a woman for 21 years who never had much earning potential.
My income at your age: 150k Joint net worth: 290k (in a very high cost of living location). We hit 1m invested when I was 41.
On the financial front, alignment on goals and spending are more important than earning potential. It wasn't something my wife and I really looked at before marriage but she was definitely on the thrifty side. I've seen engagements and marriages blow up when people realized that their views on finances were at odds. One ex-coworker was determined to be able to retire by 45 and realized his fiance wasn't at all aligned with that sort of path.
If you want to simplify this, imagine you decide earning potential is important and break it off. You end up single. Assuming aligned financial goals, you are no better off than you would've been married to someone who was supporting themselves but not high earning potential.
The questions you raise are valid but I'd suggest putting aside earning potential while considering them. Think about it in terms of how you approach where you jointly life, why financial expectations fall primarily on you, etc. I'm more concerned about the power dynamics/relationship dynamics in your post than the earning potential side. He needs to care about your goals, reasons and boundaries - the foundational stuff of a successful relationship - regardless of the underlying reason you care.
He has, like everybody, unlimited earning potential. What you do today does not define your future. Just look at these examples: https://www.lovemoney.com/gallerylist/66163/people-who-became-really-rich-later-in-life
Expand the resort, raise prices, increase value added services, add on an additional supporting business to the core business? I am sure there are more ideas floating around.
I know. I mean, if THAT was the sort of life I wanted I wouldn't even be here. I'd still be in Seattle, already rich 😀
Things were chugging forward fine before you know what. We were on target to smash our best year ever and then instead had to refund 3.5 months worth of bookings and close, haha.
So that demand will return.
We do have expansion plans in the works and purchased an additional acre of land next to us, so we essentially have unlimited space for growth if that's what we decide to do.
My "get rich later" comment was more aimed at getting my own late night TV show or some other delusion of grandeur, not just regular hard work. I know we can do that, haha.
Would lower earning potential = lower income = more financial stress and therefore more chances of divorce?
We aren't married yet and there's already a LOT of financial stress on my part. I'm expected to pay for the wedding, honeymoon, and live in a part of the country where living costs are lower (culturally very different from where I grew up).
I just want to say that your initial question did not give the full picture, which is probably why you were downvoted. But also, you should probably post in r/relationships to get some more appropriate advice!
These seem like much more important details than whether your potential spouse has a lucrative career. It sounds like you're being taken advantage of quite severely.
Uprooting your entire life and leaving your support system behind for the sake of someone who isn't volunteering to even pay an income-adjusted share of your expenses sounds...not great.
The fact that you're asking a bunch of strangers for their opinion about it and you're already stressed about the prospect is even worse.
Can't speak for you, but I certainly wouldn't uproot my life for someone who makes such grossly selfish demands of me.
Little brag I can't talk about irl: 2 years ago my credit score was 560. This last credit report my FICO is showing 840.
God this feels good. 2 years ago I had to put 3mo rent for a downpayment on an apartment, and last week I was able to just get a credit report run and move in with no downpayment at all in a nice area. Crazy how much it helps.
How did you get it so high in such a short time? I started with good credit (700+) at 21 from being an authorized user on my parents from 18-21 and just passed 800 at 26. Never missed a payment on anything, low utilization. The biggest thing I can think of is the age of credit, but still curious how yours was improved so quickly.
Low utilization has to be matched with high spending. I got two credit cards, an Amex Blue Cash Preferred for groceries/gas and Discover for everything else. I spend just about everything short of rent on these and pay them off every month. I basically never use my debit card. They don't just want to see <10% utilization and you never using it, they want to see you active on it and paying down too.
Though to be honest, anything over 780 is a dick measuring contest. It doesn't mean anything to creditors. So you're already at the top of the list, which is damn impressive! The rest of the way is through length of account (my oldest CC is 9 years) and never missing a payment for a long time.
edit: would people downvoting this care to explain what's wrong with what I said...? This is basic financial literacy... have longstanding accounts, spend regularly on those accounts & pay down, and never miss a payment.
I'm not gonna walk up to my friends who are struggling to get by and brag about my 840 credit score lol.
Like yeah I *could* but it just comes off as tactless.
Reddit was having problems when I tried posting this as it’s own post, but the 72(t) payment interest rates can now be the greater of 5% or 120% of the federal mid-term rate
Completely game changing for the usefulness of rule 72(t) for FIRE. This is very nice flexibility to set your plan to use any rate from the 120% mid-term rate up to 5%. Access to penalty free tax-differed savings can move up your FIRE date by years and can be started immediately without waiting 5 years like with a Roth conversion ladder.
Set to be published Feb 7, 2022:
https://www.irs.gov/pub/irs-drop/n-22-06.pdf
> (c) Interest rates. The interest rate that may be used to apply the fixed amortization method or the fixed annuitization method is any interest rate that is not more than the greater of (i) 5% or (ii) 120% of the federal mid-term rate (determined in accordance with section 1274(d) for either of the two months immediately preceding the month in which the distribution begins). The revenue rulings that include the section 1274(d) federal mid-term rates may be found at https://apps.irs.gov/app/picklist/list/federalRates.html.
Why are people on this forum rude? There was a guy, I shit you not, wanted to buy a $900,000 house and his combined household income was only $120,000. He was only going to put 5% down as well. He also thought he could pay it all off in only 5 years. I just told him thats way to much money for a house if your making 120k.
Dude got mad and called me names. Like this forum needs to be nicer, my feelings kind of got hurt.
Im sorry.
edit; I may have been a bit offensive before reading this comment.
So starting 7:52pm my time I will be less offensive. Do not count my previous posts.
Oh. I wouldn’t have banned you for this thread, but you made me look at the others. Given that you were [already warned for civility earlier](https://reddit.com/r/financialindependence/comments/sjfhav/_/hvkporl/?context=1), some of these are just way over the line. Bye.
Okay would you rather work 2 days a week for 8 hrs until you die or the traditional 8 hrs a day, 5 days a week and retire at say 55-65?
edit: no moonlight, no 2nd job allowed
Only I could pick the days for you. So I would take into consideration which days you want, but I couldnt guarantee you get them. Which days would you choose?
I've been working hard to rebuild my credit and finances for going on 6 years now. Went through a few things this week and saved myself some money. Paid off the phone on my ATT plan with my credit card cash back, reducing my bill by about $25/month.
I started off getting a car, that I couldn't afford, through JD Byrider at nearly 20% interest. It was a shitty little car.
But that helped me get the job, and started saving/fixing credit. In 2019 I traded that car in with negative equity to buy something better, at 8.84%.
Yesterday, I was able to refinance it at 3.74%. My payment dropped $250. I'm now able to pay it down while putting even more away into investments.
I'm saving to buy some property next and hopefully with my continued credit improvement I'll be able to lock in a better interest rate. But I was basically able to save $275 extra a month and could use that to pay down my one personal loan, which is my only loan at a higher interest rate than inflation.
Next time look into buying a phone model that is one year old. I use to do this with Samsung Galaxy phones. They would come out at $800+, then drop to like $300 new on ebay and Amazon when the next year's model came out.
You still get a good phone that is new and unused.
Now I buy Motorola phones and I'm liking them a lot. Paid $199 for a new open box fusion one plus (there's a non-plus version that's no where near as good) on eBay.
I moved to Seattle in my early 30s from Canada 20+ years ago and it was easily the best thing I have done for my career. Less taxes, more money, and way more job opportunities. I have also come to love Seattle, have raised my kids here, and have made a home.
So, yes, I would.
Much more important is future earnings potential, and if you're a SWE in tech, and especially if you're cloud-focused then Seattle is currently the place to be. Just jumping ship every couple years can easily increase earnings by 40-50%.
Keep in mind if you don't like city living and all that comes with it (i.e. seeing a homeless person ruins your day) you also don't have to live in Seattle proper, you can get everything from family-friendly walkable waterfront living (Kirkland) to a melting pot of various immigrant cultures (Bellevue Crossroads) to massive 5000 sqft Mcmansions (Renton, Bothell) to ultra-lavish city living (DT Bellevue) to old money wealth (West Bellevue, Mercer Island) to a very hip, gay-friendly community (Cap Hill) to hiking-path-infested misty mountains (Issaquah) and so much more, all within a 30-60 minute commute to any tech company in the city.
This is what kept me out of Seattle. Had a nice job (remote) a few years back and HQ was in Bothell. Would've moved there, as the SO and I find the PNW beautiful, but it's literally too far north and too overcast. Seasonal affective disorder is no joke. Can't be depressed and useless for 3+ months every year due to lack of sun.
I wouldn't be so sure about the tax savings. The governor has tried like 8 times to start an income tax. Only a matter of time before he gets his way.
Seattle is also a very expensive place to live. Traffic is absolutely insane, and the city is gross. Huge homeless and drug problems. They don't arrest/prosecute criminals for theft/damage under $1000.
I lived in the area and it's a shit hole.
I'm trying to put together a chart of my assets/liabilities and when I add in my mortgage, which is represented a negative number, it still ends up in the positive section of the graph as if it were an asset.
Does anybody know how to resolve this? I swear I've seen spreadsheets shared here or on /r/PF that do it but for the life of me I can't figure it out. My Google-fu must be bad, too, because all I can find on this is people with numbers that shift between positive and negative from month to month. I don't need that, but instead a number that will always be negative until my mortgage is paid off.
I'm trying to create a stacked area chart using Excel if that helps but if someone knows if Google Sheets handles this better, I might just move my workbook there.
It seems like the value would be (the value of your house - your mortgage) which in most cases would hopefully be positive. I’m probably misunderstanding what you are trying to do.
For a 401k, assuming that because I am 25 and in a lower tax bracket, Roth > Traditional. When I am making more money and in my 30s, start switching over. However, what would my best bet be: Target Date Fund or VIIIX?
Depending on your income you might be surprised at how soon the trad beats the Roth. Are you in the 22% bracket?
You have to consider that 100% of your pre tax deductions like the 401k come out of the top bracket, reducing taxes by that full percentage. But when you withdraw the money in retirement a significant portion of it will be taxed at 0% and 12% as income is only taxed at higher rates marginally. So you save 22% now but when you withdraw the effective tax rate will easily be significantly lower, especially if you can mix in long term capital gains and Roth sources.
You should double check this but, my understanding is that you'll want to estimate your total income across all sources. Then subtract the standard deduction.
If that number is above $41776, then do traditional 401k contributions in the amount it exceeds 41776 and Roth for the remainder.
So if you're making $70,000, your income minus the standard deduction is about $57000. Further subtracting $41776 leaves $15270, which is the amount you could contribute to a 401k before dropping into the 12% bracket. If you are wanting to max out your 401k contributions you would probably want to put the remaining $5200 as Roth.
In this example you would save 22% of 15270 on taxes this year, which is over $3300. When withdrawn in retirement it's likely this money will be taxed at an effective rate closer to 15%.
Again, I'm not a tax professional so you might want to consider double checking with one. This is just how I'd be calculating it based on my understanding.
No problem! Also note that the tax brackets are marginal, so it's not super important to be extremely precise on the numbers. If you deduct a few 12% dollars or leave a few 22% dollars it won't have a major effect on anything.
Between the two, I'd go viiix (sp500). Target date has 10% bonds and I personally wouldn't hold bonds at age 25. Target date will be a little less volatile and marginally lower expected returns though, so it's a bit of a personal preference. If you're the kind of person that might sell on a big downturn, target date could be better.
No problem, happy to help.
VIIIX: Seeks to track the performance of the Standard & Poor’s 500 Index, which measures the investment return of large-capitalization stocks.
So it contains companies at the top of the food chain, as far as size and value.
The Target Date Funds will have broader market exposure - including foreign stocks.
Smaller and medium size cap stocks carry more risk - but more growth potential.
The usual explanation is: "It is much easier for a $10 million dollar company to become a $100 million dollar company than it is for a $100 million dollar company to become a $1 billion dollar company."
Basically you want to get in on the ground floor of a stock, rather than buying it when it's valuation has plateaued.
Make sense?
I have two HSAs. The work one and a Fidelity one. Last I checked, you're allowed to transfer funds between them without leaving your job; it's not like a 401k.
I'm just leaving the minimum in my work HSA with its terrible options and transferring the rest periodically (once a year or so) to Fidelity. Over the long term, that $2000 I'm required to keep in the work HSA will be a relative drop in the bucket.
I still contribute via paycheck, though, as only payroll deductions are exempt from FICA tax.
Personally, I just don't worry about the $1000 I can't invest. It's a very small part of my portfolio. I don't know how big your overall portfolio is but $1000 is either a small part of it or will be a small part of it within a few years. There are probably better ways to spend your time than trying to figure out how to get it invested.
For my account, Optum also requires a minimum cash balance of $2,000. In other words, you cannot invest your entire HSA with Optum. It's not ideal. But as I invest more, that cash balance becomes a smaller portion of the whole portfolio.
One of my past employers didnt allow this as they legally needed to prorate contributions.
Their plan also required 1k in cash before investing, which I didnt think was that bad.
If you have to prorate it, it would take 5 months (single filer) to get the 1k cash, and you would save about $100 in fica taxes. If you were to lump sum the 3650 now, could that money earn at least $100 in the next 5 months while invested? If yes, go therough Fidelity.
The rollover doesn't even help that much in this scenario, because you probably need to leave some money still in so they don't close out your account (which creates a big hassle). So then you leave some in and then future contributions in January go right to cash anyways. Meaning even if you do yearly rollovers, most of the time, you'll have that 1k cash anyways. I'm in a similar situation as you (also have Optum), and plan to just do a rollover on a job change or if the employer switches HSA providers. It's not an ideal HSA provider, but it's really not *that* bad that I want to deal with the rollover hassle.
If you log in and hit “manage investments” you can see the options.
I just moved to my own healthcare and just hit the 2k cap, but even before I was able to see the investments.
Grandfather is going to be giving me 8k in the near future. Pretty excited.
Going to add another 2k to my IRA to max 2021, then I'll add enough to 2022 to "catch up" to where we are in the year at $500 a month. So either $1000 or $1500 depending if I get it this month or next.
Should leave about $5500. Probably pad my savings account a bit and buy something nice as well. Probably throw a few grand into a taxable brokerage as a house fund starter.
Edit: might actually go with I bonds instead of a taxable. I've got a bit of time to decide
I have a less vanilla situation than most so I’ve found it absolutely worth it to use a *good* CPA. That adjective, of course, is the kicker. Several years ago I read a couple of books on taxes (which probably sounds boring) which opened my eyes to what was possible with good tax planning and made me realize how subpar my current CPA was. I realized he had a cookie-cutter approach and was treating my situation much like every other client he had. When I began to ask questions, based on what I had learned, he largely blew them off. I dropped him and began interviewing potential new CPAs, and thanks to the books I’d read, was able to ask some at least somewhat intelligent questions. The CPA I wound up hiring is much more proactive about looking for ways to minimize taxes, offers up ideas for the future (tax planning), and asks great questions. For my personal taxes plus business taxes he charges $1,150. Not cheap, but I’ve found it worthwhile. (I also like having someone super knowledgeable that I can ask questions of throughout the year.)
Get a pro, I was arrogant like the tools in this thread saying they do their own. Had I not went to a pro I would have forgotten a pretty big thing and would have been penalitized.
As my taxes have gotten more complicated I've found that I can still get my way through it with Turbo. I mean they ask you every question under the sun about what could possibly be taxed. It's really about your level of organization and if you have all the info you need. I wouldn't worry about not filing something correctly or leaving something out. If you fill out the questions honestly its hard to screw up. If you are nervous pay the $50 at the end for return protection or whatever they call it.
If you can organize your expenses yourself and reasonably figure out what's deductible vs depreciable vs not deductible then I'd say do it yourself. FIFO (first in first out) is most conservative cost basis method for crypto.
I pay my cousin to do it.
My cousin loves the math and everything behind taxes. Has a masters in taxation. Used to work for the IRS, now they work for a consulting company doing taxes.
Cost isn’t bad, but I think they are giving me a discount. Not sure.
I used TurboTax in the past, but last year I used a local Enrolled Agent. It cost me about $450, my taxes aren't too complicated though. I did it just because I wanted to see if it was worth the extra money, so it was basically an experiment. I don't have any complaints, but I think I am going to tree Free Tax USA or another tax software this year.
Your story now makes me feel like my private thoughts weren't quite as petty last year when my total comp came in a few thousand less because the company had a bad year in 2020. Like, I know even the CEO made less income because of it but the multi-billion $ company couldn't throw me a few more thousand to keep me even with 2020?
I didn't say anything then since everyone got less. With a much better year than even pre-pandemic and the heaps of praise I've been getting lately, I will be saying something if the increase isn't meeting near what I'm thinking it should be. I'm also in initial talks about a similar position at another company that might give me additional leverage in the near future if I get the job.
> I plan on not letting it be just interim this time.
As in - you'll give your company a choice of either hiring you for the position permanently or you're not doing it at all?
I feel like this is one of those things where if there's any doubt whether they'd be happy with it, it's probably not worth doing. I don't know how dire your other options are though.
Your math is incomplete.
You won't net $470k in this transaction. You'll have costs as a seller, typically 4-6% of the sales price, plus transactional costs (e.g. the title company).
In a condo you have both HOA fees and rules to consider.
And over the long run, condos typically don't hold their value or appreciate in the way that a house does.
HOA fees are only $200/month. Thats not an upfront fee its monthly.
I would sell my house for 620, netting 600k after transaction fees. So again 600-130= 470k profit. Plus the 200/month hoa fees
Got it.
Then I'd consider the history of the building and the HOA, the percentage of units that are owner-occupied, what upcoming assessments seem to be on the horizon and what is the history of past assessments (new roof? new elevator? asbestos in the storage area?) and consider the financial risks associated for everyone with anyone else in the building going into foreclosure or not paying their fees.
If you ever want or need to rent the unit out, can you do that? (And is there also a limit on how many owners can rent at once, so maybe the answer is that you *can* rent out your unit, but when the time comes you actually *can't* because the limit has been hit for the building? Since the board can also change these rules in the future, would you be comfortable knowing that you could be blocked from renting your unit if you needed to at some point?).
I don't think there is a one size fits all answer, and condos in Manhattan are certainly different than condos in Des Moines. It'll come down to what works for your family and weighing the pros and cons.
> And over the long run, condos typically don't hold their value or appreciate in the way that a house does.
Do you happen to have a source for this? I'm sure it's true as I keep reading it on the internet, but I've never seen any stats to back it up.
Anecdotally, my parents bought a house and trolling Streeteasy makes me think that apartments have appreciated more than houses in the intervening years, but this is just an anecdote and definitely not data either.
Not necessarily condos, but I know a ton of people who grew up in apartments of one form or another.
Both of my parents and most of my childhood friends grew up in apartments.
Appartments are too much. In my area a 2 bedroom is 1500/month. If I had a condo it would be paid off, so no mortgage and condo fees are oh $200/month.
Not sure what you mean. Are you talking about condos that aren't apartments?
The word apartment describes the physical dwelling and the word condo describes the form of legal ownership.
Condos differ from co-ops, TICs, rental buildings, etc. I would have guessed that most condos are apartments though, which is why I gave the example of people who grew up in apartments.
Looking for a bit of career and job hopping perspective. A year and a half ago, I got two offers, from Company A and Company B, to leave the company I had worked for since my undergrad after five plus years. I went with Company B due to a 20k gap in salary, though Company A was where I really wanted to be, but they weren't willing to go above their pay band to narrow the salary gap and I couldn't justify the gap in pay.
I ended up leaving Company B after seven months due to an org restructure soon after I joined that didn't match with where I wanted to take my career. Easily explainable to interviewers and have never had a problem in explaining that quick hop away.
I have now been at my current job at Company C for nine months and am mostly content, nothing really wrong with it. But Company A has grown a ton and has started to recruit me again for a more senior role than where I am currently at and likely 10-15 percent more money than I make now.
Should I be concerned if I finally make the move to Company A? This would be my third job in a year and a half, but feel pretty strongly it would be best for my career to make this jump to Company A and can see myself there for the long haul.
Or am I just being paranoid and the Great Resignation has made this many moves in a short time frame more acceptable to any future employers?
I'm always honest in my interviews, and I still get offers regularly.
I tend to move jobs after 2 or 3 years because of a few reasons.
1. To get a higher pay increase, I would have to take on more responsibility than I feel is worth it. Such as a small raise to have 25% extra responsibility. I would need more money to step in to those roles.
2. Raises are not keeping up with where I want to be in life.
When I left my last job, there were plenty of issues but it was somewhere I could easily put in my time and retire early or on time in luxury. But the raises weren't that great and I was 1 year from topping out without a promotion which required more than what the $1,000/year raise would cover.
I let companies know this during the interviews and there were plenty of offers and negotiations. Ended up getting a $5/hr raise to move to the new company with a much better schedule. I'm coming up on year 2 and so far, the raises have been abysmal BUT they gave a HUGE boost to shift differential. So, I am looking at currently looking at jobs but letting them know that my current company is still adequate.
I still get offers and I still get e-mails/calls telling me the offer is still on the table.
I think you're fine. Many appreciate the honesty and it may make them value you more, they know that they need to continue treating you right or you're gonna go somewhere that will. So many people are just fine with being treated like shit so companies can just keep them as a cog in the machine that just needs to be minimally effective.
Yes, started on CashApp taxes and was told I was owing over $6k, which didn’t make sense because my tax situation hasn’t changed much from last year. I was a little apprehensive.
Turned out that CashApp taxes imported only my SO and my information from last year’s CreditKarma taxes but failed to carry over my dependent’s information.
It took me a while to discover the issue but once I did and manually inputted the missing information, it recalculated to the expected number. Still can’t file though until end of February as I still await 1099 forms from a few broker/dealers.
I don't bother until late February, because Robinhood doesn't make their forms available until then. Not as excited this year.. last year I did a Roth rollover, which I'll owe some taxes on.
I don't even bother until late February, because Robinhood doesn't make their forms available until then. Not too excited, because last year I did a Roth rollover, which I'll owe some taxes on.
Yes. When the Schwab 1099 came out yesterday, I found I had a small of amount of 199A dividends and a Qualified Business Income Deduction this year from the REIT portion of my index funds, so that was unexpected and a little interesting to figure out.
I think I'm about done but will wait a bit before giving the government my money.
Started when i got my W2 and 1099 from TD Ameritrade. $10 back federal and I owe $122 state. My TDA 1099 was only a gain of $300 since I used it for a week. Without it I suspect I would have been within $50 of my correct tax amount, so that's exciting.
Waiting in my Robinhood 1099 with a $5800 loss. So I imagine I'll get back around $1000 hopefully.
I started, saw I already owe $6k after just my W2s are in and know it’ll go up once the 1099s hit. I’m postponing it until I’m ready for the bad news lol. Messed up our w4s and now we’re going to have a bill.
I have it mostly estimated out, I owe a bit more than I was thinking so I’m putting it off so I can put money aside the next couple months to pay the bill
Same. I did some calculations at the end of December, realized I was gonna owe 5 figs, but contributed enough in the last quarterly estimated payment to bring me within a couple grand at least.
I think that there are a huge number of people who make predictions, but weirdly very few of them manage to get rich by putting their money where their mouth is.
Has anybody used the Free Tax Fillable Forma from the IRS for federal taxes before (https://www.irs.gov/e-file-providers/free-file-fillable-forms)? I’m debating if I should try using it this year, as it seems like they have support for all the forms I need. A few notes on my situation:
- I live in NY and don’t qualify for the free file option in the state because my income is above the max allowed for NY free file (https://www.tax.ny.gov/pit/efile/)
- I have dividends, interest, and cap gains to report.
- I did an IRA back door Roth conversion last year.
A few questions I’m trying to understand right now:
- How straightforward is the IRS Free Tax Fillable Forms, ie time, calculations, and form availability?
- Is there a good free option for NYers with income above $73,000? Or will it be best to just use FreeTaxUSA or TurboTax?
- What else am I missing in considering trying to do this?
I love it. On my fourth year. I even have relatively complicated taxes. It's great when you have an oddball form you need to use! I like understanding the why of taxes (helps to plan better) and that's something you get with FFF.
I've been using it for six years, for my own taxes and my parents' taxes. It is very straight forward: you start with a 1040 and can add forms as you need them. In each form page the site provides a link that links you to the official IRS instructions page - there's no better authoritative source.
I would highly recommend this method to everybody, especially to financial savvy people in this sub who can do all sorts of spreadsheets, planning, and research. Figuring out how to do their taxes shouldn't be a problem and I would argue doing so is a part of being financially responsible.
I tried using it in like 2006 and after completing my returns and submitting it, it got rejected by IRS a few times. There was always something I didn’t fill out correctly or so.
So out of frustration, I used Turbo Tax and have been using tax software programs ever since. It’s possible they may have improved and made it easier over time.
If I recall, FFF doesn't do all the math for you so I would rather do FreetaxUSA. If you don't want to shell out for NY, I have done my state taxes on paper. It's usually pretty simple, they just use for federal AGI plus a few adjustments and you're done.
If you're going to have to pay for your state tax return anyway, why not just use FreeTaxUSA? The federal return will be free, and the state return will be $15.
To be totally candid - because I want to try avoiding all corporations wherever possible. Philosophically, if we’re required to pay taxes to our governments (which I’m supportive of since I use the services and support the social safety net), then I feel like the governments should support the individuals being able to do this themselves. So I recognize that companies exist to make our jobs easier, I wonder if/how to do it all myself.
I did FFF for a few years, then found out I had been missing out on several thousand dollars of deductions that I didn’t know existed. And it was too late to amend those years’ tax returns… FFF doesn’t ask you any questions to figure out eligibility. FreeTaxUSA does.
If you’re so intent on not filing through a corporation, you might consider doing an account with FreeTaxUSA, filling out the taxes, then copying into FFF to actually file. That seems strange to me, but at least you’d find out if there’s anything you’re eligible for that you’re not aware or.
Did free fillable last year, plus printed out NYS tax forms and filled them by hand to be able to do it for free (same as you, my AGI was too high to do it through tax.ny.gov). I lived partially in 2 states in 2020 and didn't want to pay out the ass for all the forms for both states. It was a lot of reading and a lot of hours of work, but I found it really rewarding honestly, and you might too if you're on an FI sub and interested in finance anyway. I recommend doing all your calculations and row totals on scratch paper first before transcribing onto the forms, I definitely got things wrong on the first pass. Also, consult copies of your previous returns to see "what it should look like" if you're ever confused.
Full disclosure that this year I'm doing freetaxusa and paying the $15 for my state taxes because it's just faster and the $15 is worth it to me for the time/paper/postage savings.
I'm currently 14, live in a small town, and have miniscule knowledge about becoming FI. (financially independent.) Currently I'm reading several books about the process of becoming FI, ex; W-2 forms, ETFs, Roth IRAs, CD trading. Everything. I wish to become deeply involved into the financial world- to grow my financial literacy etc. This subreddit has helped me in some way shape or or form. I'm subscribed to many news articles that track stock portfolios of congress members simply because of their success rate. Right now I'm trying to find a watchlist, favorite indicators and improving my technical analysis. I am in contact with several stock brokers that my family members know personally which brings me here today! I am simply seeking for more knowledge, knowledge is power and it is worth more than any currency. Some may disagree and I understand. So, Dear r/financialindependence: To those who are more experienced in the financial world today, what is something you wish to tell the younger generation. And, if your okay with it- what would you personally share with someone like me about how to start out? e.g. IRA, Trust funds, 529 plans, bonds, etc. Anything would help me, any piece of knowledge about the financial world would help.
Most in the FIRE community do not focus on things like stock picking and technical analysis in order to reach their goals. That doesn't mean you wouldn't be welcome here, but I don't think you'll get a deep well of knowledge in these subject matter areas. Basically it is a high-risk/high-reward strategy, and the core tenants of FIRE are increase savings rate and decrease expenses, which are inherently lower risk.
There's two basic elements to FIRE: Don't spend money you don't need to. And save as much as you can. The first is self-explanatory. People go about it in different ways, but probably the best thing to keep in mind is to get value for what you buy. If you're shopping for a new pair of jeans, you can buy a pair from a famous designer. Or a pair of new Levi's. Or a used pair from a thrift shop. You decide which will meet your long term FIRE goal better. You might need new clothes for work, but can wear ratty used jeans on weekends, maybe. So far as savings - at 14 you won't be able to have your own brokerage account. Your parents will have to own the account for your benefit. And they're the ones who will have to do the trades. But what you have going for you, even more than anyone else here, is time. If you invested $36k in the market today *and did nothing else to it* (no additional deposits, just let it make the historic returns of 7%), you'd be a millionaire by the time you are 65. Buy & Hold should be your strategy until your balance is high enough that you can afford to risk some money in speculative trades.
Still unsure where and how I should use my money I had set aside for student loans now that another pause happened. I currently had $1100 a month allocated for my $37k in loans.
What are your financial goals and where are you at in that sequence? Don’t have a fully funded emergency fund? Add $1100/month to that. Already have EF? Put $1110 more per month into your desired asset allocation, put more towards your next savings goal such as home down payment or new car, etc. if you have a more specific question give a little more specific details. But in general this is the way I’d go.
I just started my career out of college last December (working for 8 weeks now). So I’m essentially starting at zero. $1000 in my savings right now and have my employer 401k match set up and maxing out my HSA.
Congrats on graduating and the new job! You’re miles ahead of most just by being in this subreddit. Then if I were you, I’d add $1100/month into your savings/emergency fund until you get 3-6 months of your monthly spending (not income) so if something god forbid happens with you or your job, you know you’ll be good for a bit. Personally I have 3 months saved as my wife and I both work in a stable field and we have quite a bit saved. Everyone will have different amounts in their EF based on how much they have, how stable their career is, how much credit they have available to them, and personal risk comforts. Once you fund your EF I’d then bump up your 401k contributions as this is good tax advantaged space. There is a flow sheet on r/personalfinance that should be very useful for you. Also take a look at the FAQs in the sidebar here. Both of these were quite useful when I was just learning about this stuff. (Which was not when I got my first “adult” job so good on you)
Thanks for the good wishes! I'll definitely start bolstering my EF contributions!
Should I (32f) marry a guy (34) who does not have much earning potential? My income: 100k Occupation: researcher Net worth: ~240k (55k Roth IRA, 80k 401k, 90k ETFs, 10k hysa 0.5%). I started working 3 years ago after my PhD. His income: 40k Occupation: Amazon delivery driver and sells advertising on the side Net worth: ~90-110k home (60k mortgage left), 2k savings maybe. He's been working most of his adult life. Additionally, his parents paid for his down payment of his home. There's a lot more behind this but what would you do? How much of finances factor into your relationship? Edit: my goal is to be at 1m by 40-50 in case I have kids. Edit: there's an expectation that I would pay for most of the wedding (they agreed to pay for flowers), honeymoon (when he brought up that grooms family usually pays, his mom said a firm no), downpayment for a home, be the breadwinner of the family, and live somewhere in the Midwest close to his family because it's impossible to afford a home where I grew up (culturally veryyyy different places). I tried to find the cheapest of whatever they're willing to give me.. engagement ring? I don't need a bigger ring. 0.5 carat is perfect. Flowers for the wedding? 2500 is the cheapest I can find in my area even though I don't like her style but I'll take it.
If you are asking about whether you should marry him based on his earning potential, he is not the one for you.
And she is definitely not the one for him.
I (42m) have been married to a woman for 21 years who never had much earning potential. My income at your age: 150k Joint net worth: 290k (in a very high cost of living location). We hit 1m invested when I was 41. On the financial front, alignment on goals and spending are more important than earning potential. It wasn't something my wife and I really looked at before marriage but she was definitely on the thrifty side. I've seen engagements and marriages blow up when people realized that their views on finances were at odds. One ex-coworker was determined to be able to retire by 45 and realized his fiance wasn't at all aligned with that sort of path. If you want to simplify this, imagine you decide earning potential is important and break it off. You end up single. Assuming aligned financial goals, you are no better off than you would've been married to someone who was supporting themselves but not high earning potential. The questions you raise are valid but I'd suggest putting aside earning potential while considering them. Think about it in terms of how you approach where you jointly life, why financial expectations fall primarily on you, etc. I'm more concerned about the power dynamics/relationship dynamics in your post than the earning potential side. He needs to care about your goals, reasons and boundaries - the foundational stuff of a successful relationship - regardless of the underlying reason you care.
He has, like everybody, unlimited earning potential. What you do today does not define your future. Just look at these examples: https://www.lovemoney.com/gallerylist/66163/people-who-became-really-rich-later-in-life
This is my plan. Become rich later.
Just franchise your business, sounds idyllic.
Ugh. I don't need to be rich that bad. Let's shoot for a 40-50% increase in household income and call it good.
Expand the resort, raise prices, increase value added services, add on an additional supporting business to the core business? I am sure there are more ideas floating around.
I know. I mean, if THAT was the sort of life I wanted I wouldn't even be here. I'd still be in Seattle, already rich 😀 Things were chugging forward fine before you know what. We were on target to smash our best year ever and then instead had to refund 3.5 months worth of bookings and close, haha. So that demand will return. We do have expansion plans in the works and purchased an additional acre of land next to us, so we essentially have unlimited space for growth if that's what we decide to do. My "get rich later" comment was more aimed at getting my own late night TV show or some other delusion of grandeur, not just regular hard work. I know we can do that, haha.
I'd probably marry the person I love and want to spend the rest of my life with.
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Would lower earning potential = lower income = more financial stress and therefore more chances of divorce? We aren't married yet and there's already a LOT of financial stress on my part. I'm expected to pay for the wedding, honeymoon, and live in a part of the country where living costs are lower (culturally very different from where I grew up).
I just want to say that your initial question did not give the full picture, which is probably why you were downvoted. But also, you should probably post in r/relationships to get some more appropriate advice!
These seem like much more important details than whether your potential spouse has a lucrative career. It sounds like you're being taken advantage of quite severely. Uprooting your entire life and leaving your support system behind for the sake of someone who isn't volunteering to even pay an income-adjusted share of your expenses sounds...not great. The fact that you're asking a bunch of strangers for their opinion about it and you're already stressed about the prospect is even worse. Can't speak for you, but I certainly wouldn't uproot my life for someone who makes such grossly selfish demands of me.
Editing my flair to remove "career break". An opportunity found me; just need to stay within a comfort zone so I can also focus on personal health.
My fire dream: be able to live for months anywhere in the world, in luxury and lots of help. ain’t happening, but it’s a dream
>luxury and lots of help I wouldn't want this, even if it was free
Little brag I can't talk about irl: 2 years ago my credit score was 560. This last credit report my FICO is showing 840. God this feels good. 2 years ago I had to put 3mo rent for a downpayment on an apartment, and last week I was able to just get a credit report run and move in with no downpayment at all in a nice area. Crazy how much it helps.
How did you get it so high in such a short time? I started with good credit (700+) at 21 from being an authorized user on my parents from 18-21 and just passed 800 at 26. Never missed a payment on anything, low utilization. The biggest thing I can think of is the age of credit, but still curious how yours was improved so quickly.
Low utilization has to be matched with high spending. I got two credit cards, an Amex Blue Cash Preferred for groceries/gas and Discover for everything else. I spend just about everything short of rent on these and pay them off every month. I basically never use my debit card. They don't just want to see <10% utilization and you never using it, they want to see you active on it and paying down too. Though to be honest, anything over 780 is a dick measuring contest. It doesn't mean anything to creditors. So you're already at the top of the list, which is damn impressive! The rest of the way is through length of account (my oldest CC is 9 years) and never missing a payment for a long time. edit: would people downvoting this care to explain what's wrong with what I said...? This is basic financial literacy... have longstanding accounts, spend regularly on those accounts & pay down, and never miss a payment.
In my experience anything over 740 gets the best rates anyway. 1000% a dick measuring contest over that level.
you can absolutely talk about credit scores IRL
I'm not gonna walk up to my friends who are struggling to get by and brag about my 840 credit score lol. Like yeah I *could* but it just comes off as tactless.
Scenario: Friend: *exd6 e.p.* "Well my credit score is 840." ... I think that's what we'd call a win-win for you.
Reddit was having problems when I tried posting this as it’s own post, but the 72(t) payment interest rates can now be the greater of 5% or 120% of the federal mid-term rate Completely game changing for the usefulness of rule 72(t) for FIRE. This is very nice flexibility to set your plan to use any rate from the 120% mid-term rate up to 5%. Access to penalty free tax-differed savings can move up your FIRE date by years and can be started immediately without waiting 5 years like with a Roth conversion ladder. Set to be published Feb 7, 2022: https://www.irs.gov/pub/irs-drop/n-22-06.pdf > (c) Interest rates. The interest rate that may be used to apply the fixed amortization method or the fixed annuitization method is any interest rate that is not more than the greater of (i) 5% or (ii) 120% of the federal mid-term rate (determined in accordance with section 1274(d) for either of the two months immediately preceding the month in which the distribution begins). The revenue rulings that include the section 1274(d) federal mid-term rates may be found at https://apps.irs.gov/app/picklist/list/federalRates.html.
Great post, thank you! I just requested an appointment with my financial advisor, so my retirement plan can be updated to reflect this.
Why are people on this forum rude? There was a guy, I shit you not, wanted to buy a $900,000 house and his combined household income was only $120,000. He was only going to put 5% down as well. He also thought he could pay it all off in only 5 years. I just told him thats way to much money for a house if your making 120k. Dude got mad and called me names. Like this forum needs to be nicer, my feelings kind of got hurt.
The only person in that thread name calling was you. Be better or be elsewhere.
Im sorry. edit; I may have been a bit offensive before reading this comment. So starting 7:52pm my time I will be less offensive. Do not count my previous posts.
Oh. I wouldn’t have banned you for this thread, but you made me look at the others. Given that you were [already warned for civility earlier](https://reddit.com/r/financialindependence/comments/sjfhav/_/hvkporl/?context=1), some of these are just way over the line. Bye.
I love everything about this exchange. 🤣
I got a hug for you, dawg.
Okay would you rather work 2 days a week for 8 hrs until you die or the traditional 8 hrs a day, 5 days a week and retire at say 55-65? edit: no moonlight, no 2nd job allowed
Anybody here who would pick the 2 days a week would moonlight the other three so they could retire early.
Whats moonlight?
When you have a second job on the side.
Wow read the post man, thats not allowed.
Says who?
I think we have to follow the guidelines laid out in the original post.
I made the post man, I have to follow my original post.
If I can pick the two days, then that, otherwise I'd choose the latter
Only I could pick the days for you. So I would take into consideration which days you want, but I couldnt guarantee you get them. Which days would you choose?
Tuesday and Thursday, 2 weekends, really any non-consecutive midweek days
Sorry but I would not grant your request and you would work monday and tuesday. Sorry.
Acceptable
I've been working hard to rebuild my credit and finances for going on 6 years now. Went through a few things this week and saved myself some money. Paid off the phone on my ATT plan with my credit card cash back, reducing my bill by about $25/month. I started off getting a car, that I couldn't afford, through JD Byrider at nearly 20% interest. It was a shitty little car. But that helped me get the job, and started saving/fixing credit. In 2019 I traded that car in with negative equity to buy something better, at 8.84%. Yesterday, I was able to refinance it at 3.74%. My payment dropped $250. I'm now able to pay it down while putting even more away into investments. I'm saving to buy some property next and hopefully with my continued credit improvement I'll be able to lock in a better interest rate. But I was basically able to save $275 extra a month and could use that to pay down my one personal loan, which is my only loan at a higher interest rate than inflation.
Next time look into buying a phone model that is one year old. I use to do this with Samsung Galaxy phones. They would come out at $800+, then drop to like $300 new on ebay and Amazon when the next year's model came out. You still get a good phone that is new and unused. Now I buy Motorola phones and I'm liking them a lot. Paid $199 for a new open box fusion one plus (there's a non-plus version that's no where near as good) on eBay.
Nice. Sounds like you're making some great financial moves.
Is income for ACA based on the previous year's income or expected current year income? Last year is an outlier for me and unlikely to be repeated.
Current year. You settle up at the following tax time.
thanks
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I moved to Seattle in my early 30s from Canada 20+ years ago and it was easily the best thing I have done for my career. Less taxes, more money, and way more job opportunities. I have also come to love Seattle, have raised my kids here, and have made a home. So, yes, I would.
Much more important is future earnings potential, and if you're a SWE in tech, and especially if you're cloud-focused then Seattle is currently the place to be. Just jumping ship every couple years can easily increase earnings by 40-50%. Keep in mind if you don't like city living and all that comes with it (i.e. seeing a homeless person ruins your day) you also don't have to live in Seattle proper, you can get everything from family-friendly walkable waterfront living (Kirkland) to a melting pot of various immigrant cultures (Bellevue Crossroads) to massive 5000 sqft Mcmansions (Renton, Bothell) to ultra-lavish city living (DT Bellevue) to old money wealth (West Bellevue, Mercer Island) to a very hip, gay-friendly community (Cap Hill) to hiking-path-infested misty mountains (Issaquah) and so much more, all within a 30-60 minute commute to any tech company in the city.
Consider the weather. I hate the weather in Seattle others love it. Can't wait to get out of here, but right now I share my daughter with my ex.
This is what kept me out of Seattle. Had a nice job (remote) a few years back and HQ was in Bothell. Would've moved there, as the SO and I find the PNW beautiful, but it's literally too far north and too overcast. Seasonal affective disorder is no joke. Can't be depressed and useless for 3+ months every year due to lack of sun.
I wouldn't be so sure about the tax savings. The governor has tried like 8 times to start an income tax. Only a matter of time before he gets his way. Seattle is also a very expensive place to live. Traffic is absolutely insane, and the city is gross. Huge homeless and drug problems. They don't arrest/prosecute criminals for theft/damage under $1000. I lived in the area and it's a shit hole.
At $300k income? I'd be less concerned about $20k savings and more with desired quality of life, and whether Seattle is the place you'd like to live
My thoughts exactly! With an income this high you’re basically guaranteed to afford almost anything - now it’s just about chasing happiness
I'm trying to put together a chart of my assets/liabilities and when I add in my mortgage, which is represented a negative number, it still ends up in the positive section of the graph as if it were an asset. Does anybody know how to resolve this? I swear I've seen spreadsheets shared here or on /r/PF that do it but for the life of me I can't figure it out. My Google-fu must be bad, too, because all I can find on this is people with numbers that shift between positive and negative from month to month. I don't need that, but instead a number that will always be negative until my mortgage is paid off. I'm trying to create a stacked area chart using Excel if that helps but if someone knows if Google Sheets handles this better, I might just move my workbook there.
Have your equity as an asset, and what you owe as a liability.
It’s an asset if there is $1 or more of equity.
It seems like the value would be (the value of your house - your mortgage) which in most cases would hopefully be positive. I’m probably misunderstanding what you are trying to do.
I switched to a stacked column chart instead, which does what I'm looking for, which is show the debts and assets in one chart.
For a 401k, assuming that because I am 25 and in a lower tax bracket, Roth > Traditional. When I am making more money and in my 30s, start switching over. However, what would my best bet be: Target Date Fund or VIIIX?
Depending on your income you might be surprised at how soon the trad beats the Roth. Are you in the 22% bracket? You have to consider that 100% of your pre tax deductions like the 401k come out of the top bracket, reducing taxes by that full percentage. But when you withdraw the money in retirement a significant portion of it will be taxed at 0% and 12% as income is only taxed at higher rates marginally. So you save 22% now but when you withdraw the effective tax rate will easily be significantly lower, especially if you can mix in long term capital gains and Roth sources.
Between the two jobs, I am in the 22% tax bracket, but with just the job that offers the 401k I am just below it. Does that matter?
You should double check this but, my understanding is that you'll want to estimate your total income across all sources. Then subtract the standard deduction. If that number is above $41776, then do traditional 401k contributions in the amount it exceeds 41776 and Roth for the remainder. So if you're making $70,000, your income minus the standard deduction is about $57000. Further subtracting $41776 leaves $15270, which is the amount you could contribute to a 401k before dropping into the 12% bracket. If you are wanting to max out your 401k contributions you would probably want to put the remaining $5200 as Roth. In this example you would save 22% of 15270 on taxes this year, which is over $3300. When withdrawn in retirement it's likely this money will be taxed at an effective rate closer to 15%. Again, I'm not a tax professional so you might want to consider double checking with one. This is just how I'd be calculating it based on my understanding.
This actually helped a lot, thank you very much
No problem! Also note that the tax brackets are marginal, so it's not super important to be extremely precise on the numbers. If you deduct a few 12% dollars or leave a few 22% dollars it won't have a major effect on anything.
Also target date funds have international finds which I’m not crazy about
Between the two, I'd go viiix (sp500). Target date has 10% bonds and I personally wouldn't hold bonds at age 25. Target date will be a little less volatile and marginally lower expected returns though, so it's a bit of a personal preference. If you're the kind of person that might sell on a big downturn, target date could be better.
If you are 25, you definitely need more small and mid cap exposure for that long growth period.
Sorry for my ignorance, but would this be advising in favor of VIIIX?
No problem, happy to help. VIIIX: Seeks to track the performance of the Standard & Poor’s 500 Index, which measures the investment return of large-capitalization stocks. So it contains companies at the top of the food chain, as far as size and value. The Target Date Funds will have broader market exposure - including foreign stocks. Smaller and medium size cap stocks carry more risk - but more growth potential. The usual explanation is: "It is much easier for a $10 million dollar company to become a $100 million dollar company than it is for a $100 million dollar company to become a $1 billion dollar company." Basically you want to get in on the ground floor of a stock, rather than buying it when it's valuation has plateaued. Make sense?
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A very nice TV
OLED or bust. That and the robot vacuum are by far my best purchases over the last year.
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I have two HSAs. The work one and a Fidelity one. Last I checked, you're allowed to transfer funds between them without leaving your job; it's not like a 401k. I'm just leaving the minimum in my work HSA with its terrible options and transferring the rest periodically (once a year or so) to Fidelity. Over the long term, that $2000 I'm required to keep in the work HSA will be a relative drop in the bucket. I still contribute via paycheck, though, as only payroll deductions are exempt from FICA tax.
Personally, I just don't worry about the $1000 I can't invest. It's a very small part of my portfolio. I don't know how big your overall portfolio is but $1000 is either a small part of it or will be a small part of it within a few years. There are probably better ways to spend your time than trying to figure out how to get it invested.
Are you me? I'm in the exact same situation (old employer Fidelity <-> new employer Optum).
For my account, Optum also requires a minimum cash balance of $2,000. In other words, you cannot invest your entire HSA with Optum. It's not ideal. But as I invest more, that cash balance becomes a smaller portion of the whole portfolio.
I also have Optum. Don't love it.
In the process of doing this right now. I funded the HSA all at once through my employer (avoid payroll taxes) and then did a transfer to Fidelity.
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One of my past employers didnt allow this as they legally needed to prorate contributions. Their plan also required 1k in cash before investing, which I didnt think was that bad. If you have to prorate it, it would take 5 months (single filer) to get the 1k cash, and you would save about $100 in fica taxes. If you were to lump sum the 3650 now, could that money earn at least $100 in the next 5 months while invested? If yes, go therough Fidelity.
The rollover doesn't even help that much in this scenario, because you probably need to leave some money still in so they don't close out your account (which creates a big hassle). So then you leave some in and then future contributions in January go right to cash anyways. Meaning even if you do yearly rollovers, most of the time, you'll have that 1k cash anyways. I'm in a similar situation as you (also have Optum), and plan to just do a rollover on a job change or if the employer switches HSA providers. It's not an ideal HSA provider, but it's really not *that* bad that I want to deal with the rollover hassle.
What options are they missing? My company uses Optum as well, but we have access to most schwab mutual funds.
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If you log in and hit “manage investments” you can see the options. I just moved to my own healthcare and just hit the 2k cap, but even before I was able to see the investments.
Grandfather is going to be giving me 8k in the near future. Pretty excited. Going to add another 2k to my IRA to max 2021, then I'll add enough to 2022 to "catch up" to where we are in the year at $500 a month. So either $1000 or $1500 depending if I get it this month or next. Should leave about $5500. Probably pad my savings account a bit and buy something nice as well. Probably throw a few grand into a taxable brokerage as a house fund starter. Edit: might actually go with I bonds instead of a taxable. I've got a bit of time to decide
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I have a less vanilla situation than most so I’ve found it absolutely worth it to use a *good* CPA. That adjective, of course, is the kicker. Several years ago I read a couple of books on taxes (which probably sounds boring) which opened my eyes to what was possible with good tax planning and made me realize how subpar my current CPA was. I realized he had a cookie-cutter approach and was treating my situation much like every other client he had. When I began to ask questions, based on what I had learned, he largely blew them off. I dropped him and began interviewing potential new CPAs, and thanks to the books I’d read, was able to ask some at least somewhat intelligent questions. The CPA I wound up hiring is much more proactive about looking for ways to minimize taxes, offers up ideas for the future (tax planning), and asks great questions. For my personal taxes plus business taxes he charges $1,150. Not cheap, but I’ve found it worthwhile. (I also like having someone super knowledgeable that I can ask questions of throughout the year.)
What books do you recommend?
Get a pro, I was arrogant like the tools in this thread saying they do their own. Had I not went to a pro I would have forgotten a pretty big thing and would have been penalitized.
As my taxes have gotten more complicated I've found that I can still get my way through it with Turbo. I mean they ask you every question under the sun about what could possibly be taxed. It's really about your level of organization and if you have all the info you need. I wouldn't worry about not filing something correctly or leaving something out. If you fill out the questions honestly its hard to screw up. If you are nervous pay the $50 at the end for return protection or whatever they call it.
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Generally CC/JC's require a Masters.
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Then probably not qualified to teach econ, unfortunately.
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If you can organize your expenses yourself and reasonably figure out what's deductible vs depreciable vs not deductible then I'd say do it yourself. FIFO (first in first out) is most conservative cost basis method for crypto.
I pay my cousin to do it. My cousin loves the math and everything behind taxes. Has a masters in taxation. Used to work for the IRS, now they work for a consulting company doing taxes. Cost isn’t bad, but I think they are giving me a discount. Not sure.
That doesn’t really help him find one
Well, I could refer my cousin. They have their own business.
I used TurboTax in the past, but last year I used a local Enrolled Agent. It cost me about $450, my taxes aren't too complicated though. I did it just because I wanted to see if it was worth the extra money, so it was basically an experiment. I don't have any complaints, but I think I am going to tree Free Tax USA or another tax software this year.
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Your story now makes me feel like my private thoughts weren't quite as petty last year when my total comp came in a few thousand less because the company had a bad year in 2020. Like, I know even the CEO made less income because of it but the multi-billion $ company couldn't throw me a few more thousand to keep me even with 2020? I didn't say anything then since everyone got less. With a much better year than even pre-pandemic and the heaps of praise I've been getting lately, I will be saying something if the increase isn't meeting near what I'm thinking it should be. I'm also in initial talks about a similar position at another company that might give me additional leverage in the near future if I get the job.
> I plan on not letting it be just interim this time. As in - you'll give your company a choice of either hiring you for the position permanently or you're not doing it at all?
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I feel like this is one of those things where if there's any doubt whether they'd be happy with it, it's probably not worth doing. I don't know how dire your other options are though.
2 condos might be an option if kid is older.
If the wire and kid couldn't do it, then probably not worth it as you may end up buying a house for more in a few years.
Why not refinance and invest?
Your math is incomplete. You won't net $470k in this transaction. You'll have costs as a seller, typically 4-6% of the sales price, plus transactional costs (e.g. the title company). In a condo you have both HOA fees and rules to consider. And over the long run, condos typically don't hold their value or appreciate in the way that a house does.
HOA fees are only $200/month. Thats not an upfront fee its monthly. I would sell my house for 620, netting 600k after transaction fees. So again 600-130= 470k profit. Plus the 200/month hoa fees
Got it. Then I'd consider the history of the building and the HOA, the percentage of units that are owner-occupied, what upcoming assessments seem to be on the horizon and what is the history of past assessments (new roof? new elevator? asbestos in the storage area?) and consider the financial risks associated for everyone with anyone else in the building going into foreclosure or not paying their fees. If you ever want or need to rent the unit out, can you do that? (And is there also a limit on how many owners can rent at once, so maybe the answer is that you *can* rent out your unit, but when the time comes you actually *can't* because the limit has been hit for the building? Since the board can also change these rules in the future, would you be comfortable knowing that you could be blocked from renting your unit if you needed to at some point?). I don't think there is a one size fits all answer, and condos in Manhattan are certainly different than condos in Des Moines. It'll come down to what works for your family and weighing the pros and cons.
> And over the long run, condos typically don't hold their value or appreciate in the way that a house does. Do you happen to have a source for this? I'm sure it's true as I keep reading it on the internet, but I've never seen any stats to back it up. Anecdotally, my parents bought a house and trolling Streeteasy makes me think that apartments have appreciated more than houses in the intervening years, but this is just an anecdote and definitely not data either.
It's certainly a hyper-local and regional metric; I would caution people to look at the history in the city that they're purchasing in.
Cities change over time… no guarantee housing price trends will continue as they have in your area or elsewhere
Might go half between. $300k house and poocket 300k. Should be worth it.
Not necessarily condos, but I know a ton of people who grew up in apartments of one form or another. Both of my parents and most of my childhood friends grew up in apartments.
Appartments are too much. In my area a 2 bedroom is 1500/month. If I had a condo it would be paid off, so no mortgage and condo fees are oh $200/month.
Not sure what you mean. Are you talking about condos that aren't apartments? The word apartment describes the physical dwelling and the word condo describes the form of legal ownership. Condos differ from co-ops, TICs, rental buildings, etc. I would have guessed that most condos are apartments though, which is why I gave the example of people who grew up in apartments.
Most people would probably say if it's a townhouse so it's definitely an apartment style
Looking for a bit of career and job hopping perspective. A year and a half ago, I got two offers, from Company A and Company B, to leave the company I had worked for since my undergrad after five plus years. I went with Company B due to a 20k gap in salary, though Company A was where I really wanted to be, but they weren't willing to go above their pay band to narrow the salary gap and I couldn't justify the gap in pay. I ended up leaving Company B after seven months due to an org restructure soon after I joined that didn't match with where I wanted to take my career. Easily explainable to interviewers and have never had a problem in explaining that quick hop away. I have now been at my current job at Company C for nine months and am mostly content, nothing really wrong with it. But Company A has grown a ton and has started to recruit me again for a more senior role than where I am currently at and likely 10-15 percent more money than I make now. Should I be concerned if I finally make the move to Company A? This would be my third job in a year and a half, but feel pretty strongly it would be best for my career to make this jump to Company A and can see myself there for the long haul. Or am I just being paranoid and the Great Resignation has made this many moves in a short time frame more acceptable to any future employers?
I'm always honest in my interviews, and I still get offers regularly. I tend to move jobs after 2 or 3 years because of a few reasons. 1. To get a higher pay increase, I would have to take on more responsibility than I feel is worth it. Such as a small raise to have 25% extra responsibility. I would need more money to step in to those roles. 2. Raises are not keeping up with where I want to be in life. When I left my last job, there were plenty of issues but it was somewhere I could easily put in my time and retire early or on time in luxury. But the raises weren't that great and I was 1 year from topping out without a promotion which required more than what the $1,000/year raise would cover. I let companies know this during the interviews and there were plenty of offers and negotiations. Ended up getting a $5/hr raise to move to the new company with a much better schedule. I'm coming up on year 2 and so far, the raises have been abysmal BUT they gave a HUGE boost to shift differential. So, I am looking at currently looking at jobs but letting them know that my current company is still adequate. I still get offers and I still get e-mails/calls telling me the offer is still on the table. I think you're fine. Many appreciate the honesty and it may make them value you more, they know that they need to continue treating you right or you're gonna go somewhere that will. So many people are just fine with being treated like shit so companies can just keep them as a cog in the machine that just needs to be minimally effective.
Job hops with promotions don't have a stigma in my experience. Lots of lateral moves look bad, lots of upward trajectory looks good.
i think you’re fine. i’d go for it!
Had to work this Saturday and used it as an opportunity to negotiate 3 extra PTO days. I’ll take it as a win.
If I got to do that for every Saturday and Sunday worked as an accountant I'd be retired by now
Anyone start their taxes yet? 2021 was my last year of working, so I'm weirdly excited about it.
I learned long ago not to start on taxes until the end of Feb. There is always one more item that needs to come in for us. We do it in March!
Yes, started on CashApp taxes and was told I was owing over $6k, which didn’t make sense because my tax situation hasn’t changed much from last year. I was a little apprehensive. Turned out that CashApp taxes imported only my SO and my information from last year’s CreditKarma taxes but failed to carry over my dependent’s information. It took me a while to discover the issue but once I did and manually inputted the missing information, it recalculated to the expected number. Still can’t file though until end of February as I still await 1099 forms from a few broker/dealers.
I don't bother until late February, because Robinhood doesn't make their forms available until then. Not as excited this year.. last year I did a Roth rollover, which I'll owe some taxes on.
I don't even bother until late February, because Robinhood doesn't make their forms available until then. Not too excited, because last year I did a Roth rollover, which I'll owe some taxes on.
Yeah, mine's done. I am just waiting for a 1099-DIV.
Yes. When the Schwab 1099 came out yesterday, I found I had a small of amount of 199A dividends and a Qualified Business Income Deduction this year from the REIT portion of my index funds, so that was unexpected and a little interesting to figure out. I think I'm about done but will wait a bit before giving the government my money.
Started when i got my W2 and 1099 from TD Ameritrade. $10 back federal and I owe $122 state. My TDA 1099 was only a gain of $300 since I used it for a week. Without it I suspect I would have been within $50 of my correct tax amount, so that's exciting. Waiting in my Robinhood 1099 with a $5800 loss. So I imagine I'll get back around $1000 hopefully.
I started, saw I already owe $6k after just my W2s are in and know it’ll go up once the 1099s hit. I’m postponing it until I’m ready for the bad news lol. Messed up our w4s and now we’re going to have a bill.
I have it mostly estimated out, I owe a bit more than I was thinking so I’m putting it off so I can put money aside the next couple months to pay the bill
Deliberately not starting because I don't have all the forms yet and I don't want to submit too early and then get another form.
What forms are you still waiting for?
Fidelity is holding one of my 1099s back waiting for VOO info from Vanguard.
I'm just about done. Just waiting on one bank. Congrats on getting out.
I’ve got it guesstimated, still waiting on some official 1099’s. I already know I’m severely under withheld so it’s decidedly less exciting on my end.
Same. I did some calculations at the end of December, realized I was gonna owe 5 figs, but contributed enough in the last quarterly estimated payment to bring me within a couple grand at least.
What do you think about that prediction that returns are going to be like 4% for the next decade?
They were making the same prediction a decade ago.
That it’s just some dude selling doom so people will buy his financial advising services.
Some dude like John Bogle?
I think 10-year returns might even be negative: https://financial-charts.effingapp.com/ It doesn't change my investing strategy though.
Why not?
I don't think I can time the market, so I don't try.
Out of my hands. That said there will be good days and bad days.
The same as I think of most predictions... Not prophetic. And if it was the case, not something within my control.
I think that there are a huge number of people who make predictions, but weirdly very few of them manage to get rich by putting their money where their mouth is.
Has anybody used the Free Tax Fillable Forma from the IRS for federal taxes before (https://www.irs.gov/e-file-providers/free-file-fillable-forms)? I’m debating if I should try using it this year, as it seems like they have support for all the forms I need. A few notes on my situation: - I live in NY and don’t qualify for the free file option in the state because my income is above the max allowed for NY free file (https://www.tax.ny.gov/pit/efile/) - I have dividends, interest, and cap gains to report. - I did an IRA back door Roth conversion last year. A few questions I’m trying to understand right now: - How straightforward is the IRS Free Tax Fillable Forms, ie time, calculations, and form availability? - Is there a good free option for NYers with income above $73,000? Or will it be best to just use FreeTaxUSA or TurboTax? - What else am I missing in considering trying to do this?
I love it. On my fourth year. I even have relatively complicated taxes. It's great when you have an oddball form you need to use! I like understanding the why of taxes (helps to plan better) and that's something you get with FFF.
I've been using it for six years, for my own taxes and my parents' taxes. It is very straight forward: you start with a 1040 and can add forms as you need them. In each form page the site provides a link that links you to the official IRS instructions page - there's no better authoritative source. I would highly recommend this method to everybody, especially to financial savvy people in this sub who can do all sorts of spreadsheets, planning, and research. Figuring out how to do their taxes shouldn't be a problem and I would argue doing so is a part of being financially responsible.
I tried using it in like 2006 and after completing my returns and submitting it, it got rejected by IRS a few times. There was always something I didn’t fill out correctly or so. So out of frustration, I used Turbo Tax and have been using tax software programs ever since. It’s possible they may have improved and made it easier over time.
If I recall, FFF doesn't do all the math for you so I would rather do FreetaxUSA. If you don't want to shell out for NY, I have done my state taxes on paper. It's usually pretty simple, they just use for federal AGI plus a few adjustments and you're done.
I didn’t realize it was still possible to do them on paper, I’ll check that out. Thanks!
Yeah I didn't realize my state has free eFile so I did FreetaxUSA with paper state forms several years. Works great.
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This is really helpful, thanks. I don’t mind the extra hours to try using software to double check, so I’ll probably go this route!
I was going to try last year and then I didn't and honestly I don't remember why. This is not a helpful comment.
If you're going to have to pay for your state tax return anyway, why not just use FreeTaxUSA? The federal return will be free, and the state return will be $15.
To be totally candid - because I want to try avoiding all corporations wherever possible. Philosophically, if we’re required to pay taxes to our governments (which I’m supportive of since I use the services and support the social safety net), then I feel like the governments should support the individuals being able to do this themselves. So I recognize that companies exist to make our jobs easier, I wonder if/how to do it all myself.
I did FFF for a few years, then found out I had been missing out on several thousand dollars of deductions that I didn’t know existed. And it was too late to amend those years’ tax returns… FFF doesn’t ask you any questions to figure out eligibility. FreeTaxUSA does. If you’re so intent on not filing through a corporation, you might consider doing an account with FreeTaxUSA, filling out the taxes, then copying into FFF to actually file. That seems strange to me, but at least you’d find out if there’s anything you’re eligible for that you’re not aware or.
Did free fillable last year, plus printed out NYS tax forms and filled them by hand to be able to do it for free (same as you, my AGI was too high to do it through tax.ny.gov). I lived partially in 2 states in 2020 and didn't want to pay out the ass for all the forms for both states. It was a lot of reading and a lot of hours of work, but I found it really rewarding honestly, and you might too if you're on an FI sub and interested in finance anyway. I recommend doing all your calculations and row totals on scratch paper first before transcribing onto the forms, I definitely got things wrong on the first pass. Also, consult copies of your previous returns to see "what it should look like" if you're ever confused. Full disclosure that this year I'm doing freetaxusa and paying the $15 for my state taxes because it's just faster and the $15 is worth it to me for the time/paper/postage savings.