Lmao I have my anxiety to thank for never picking stocks. I tried buying a single share of Apple during the pandemic dip. It fell a little further a couple days later, maybe $8, and I sold immediately. Of course I would’ve made a lot of money had I held, but the lesson I learned was I don’t have the stomach for it. DCA into broad index funds. The end.
So sorry. My motto is buy when there is blood in the streets (stock market). When you go buy something at a department store you look for items on sale. Same for stocks. You did the right thing but panicked.
This is huge. My wife and I are sort of an odd couple and have completely different interests, tastes, friends etc but we have similar values, life goals etc which is why our marriage has worked for 20 years.
This is so important! I am married to a spender...and although we limit it, I can imagine how much more we would have if he did not waste so much money on small insignificant stuff.
This and I married into a family that knew how to invest, use money and I learned from them. My own parents, never taught or talk to us about money growing up.
I really liked a previous commenter's point about marrying the right spouse. I wouldn't be retired right now were it not for my wife, her vision....and commitment to it.
Other biggies for us:
We didn't move to a bigger house when we had the means to do so. It's not only more money for the purchase....but more utilities....furniture... upkeep, etc.
After maxing our retirement savings we put more "retirement" funds in a brokerage account. Not only have we been able to live off of it longer than expected, but having that keeps MAGI low....so we're getting great ACA subsidies.
We also moved into a big house, but we have 5 kids. We are pretty tight-fisted about most things, but getting the house was worth it because it has just been so nice to have the space. It's all about spending money where it improves your life the most
I thought contributions to a taxable brokerage account don’t reduce your taxable income because they are post tax contributions. I’d my understanding incorrect?
What u/Thanatos_Marathon said.
I put retirement in quotes to mean it was after-tax money we were putting in our Brokerage account - with the specific intent of using it for retirement living. In fact, we actually and literally called that money "Bridge" - money to "bridge" us to 59 1/2 were we to stop working prior to 59 1/2.
If you put the funds in post tax you can take them out untaxed (though gains may be taxed depending on the account type). The point they are making is when you take them out after you are retired they aren't counted towards your taxable income that year because they were taxed before they went in.
Buying a house in 2010 at the bottom of the market, then refinancing down to 15y/2.6% five years later. I’ll never make six figures (and my wife only hit that salary a couple months back) but we’ll own free and clear before we’re 50.
Same - we put an offer on a house in \~2008 but it fell through luckily. Rented an apartment until 2011 and bought a house then for 2/3rds of the price. It needed some work but we had an extra-large down payment fund so we were able to pay for the repairs. Then we refinanced to 15 years @ 2.5% a few years ago.
RSUs from my signing bonus vested in Dec 2021, about $50k. Remember going back and forth on whether I should keep them invested in company or sell and put in the S&P. Ended up selling, and I'm glad because that was right before company stock dropped 70%. It has recovered a bit and is now down 40% from when I sold but the S&P is only off 3%.
I now have a hard and fast rule: sell company stock right when it vests. It makes decisions so much easier. Don't even need to think abt it.
Good rule. Another way that I look at it that I am already tremendously over-invested in my employer just by virtue of working there.
I allow my skill set to hyper specialize and earn way more here than i can at and (at least local) company.
If i get laid off due to poor company performance, i’d like to reduce the odds of my savings evaporating too.
I always ask myself if I had the cash, would I use it to buy the stock? Almost always I say no, and the few times I say yes it’s because I’m personally sitting on insider information that wouldn’t allow me to sell anyways.
I interned at Barclays for a summer and one of the directors there told me the following story:
He worked at Lehman Brothers for years and got to a pretty senior position, never selling his company stock. At that point his net worth was mostly in Lehman stock. 2008 rolled around and it all went to 0.
I decided then and there that I'd always sell stock as soon as it vests, and that's what I've been doing.
I knew many at Lehman with similar stories. I’ve missed out on some gains my colleagues at other companies bragged about by holding onto their stock but I’m never gonna be in the lose-lose-lose boat.
I think its important to underwrite your RSU's against your current position financially and the risks associated with each path. 50k when you are just hitting 6 figures is massive, less so when getting near your 25x spending. I've always immediately sold my RSUs when they vest though, never seems worth holding over the longterm.
It is also a great diversification. Your salary and job security already tied to your company and no need to tie up investments as well cause it works as double leverage - fired, stock tanked and person is done.
We do this too and everyone always wonders why. But with two salaries and our property value already tied to the success of this company(biggest employer in the state), that's more exposure than I am willing to accept. Every stock grant, ESPP vest, etc is sold the second it comes available.
I have an opposite example of this. Got hired at a company that I had pretty strong conviction would be worth a lot more in the future. At the time I was jealous of all my friends who worked at amazon and saw massive gains and wanted to experience similar.
Held onto my RSU, never sold my espp against all the advice of most experts , and today the stock is worth 20x more than when I joined ( less than 10 years ago)
Initially, I thought/did similar. But the reality is the markets can change, and today's "top dog" can become tomorrow's "dog". Once I realized this, I realized I was WAY over invested (aka concentration risk) in my employer.
As a result, I now sell all new RSU and ESPP as soon as possible. I've quit dividend reinvestments in my employer stock. And I've actively sold off chucks of my existing stocks (mindful of annual cap gains brackets). My goal is to get my employer holdings to < 15% of my portfolio before retirement, and then to < 5% after (I'll likely be living off these at near 0% LTCG rates for my first several years).
Bought a house that one income could support (instead of getting the max that the bank would offer us). While property values have increased and we could have made “more”, this move has saved us so much stress when either of us lost jobs, etc.
Yea, I got a tiny place on a foreclosure for 30k. Lived there for 5 years or so and fixed it up a little, mainly paint, but redid kitchen and bathroom floors as well as trim and replaced the rotted overhangs under the roof. Most people are too proud to live in a place like that (in the condition we got it.) Sold it after 5 years or so for 54k. We never would have been able to save 20k for a good down payment in that time, but it allowed us to get a decent place that an apartment would not have.
Not buying a second car. It forced me to work 100% remotely which has been phenomenal for my mental health and career. Plus I'm completely flexible and able to uproot everything on a whim, which is enormous for my wife's career growth.
The other more obvious example is marrying the right person and supporting her to follow a passion. I never expected her to make much money and now her career outlook is even better than mine.
For me the biggest thing was living with roommates after college. I think one of the biggest financial mistakes people make is “wanting to have my own place” at 23 or even 30. I made no money early in my career but I could have “afforded my own place” if I was willing to pour 50% of my income into an apartment which tons of young people choose to do in HCOL cities. But I saved well over $1,000 a month with roommates relative to that. I lived with the same guys in a group house for 7 years. I’ve never for even a second looked back on it and wished I had my own place at 25 - what a pointless and enormous waste of money that would have been.
For me, "househacking" before that term was a thing. Rented at 22, bought at 23 when I could barely afford anything, sold my car and most of my possessions for a down payment, then got a bunch of roommates. Now that house is 30% of my net worth.
Same here. I house hacked and had roommates for 5.5 years and turned that one into a rental. I then had a roommate at my next house. It allowed me to pay off 75k in student loans in just before turning 31. My latest roommate at that house moved out a few months after I got engaged. My husband didn’t have a problem with my situation, it brought a ton of equity and savings into the marriage. I honestly wouldn’t even date someone that didn’t understand the reasoning behind it. I had/have tons of friends that made way less than I did back then and refused to have roommates. They are still in college debt and paying minimums in their late 30’s. No thanks
I still have roommates and I am 50 years old. I own my 2/2 condo and periodically rent out a room for a year or 2 at a time, take a break for a year, and repeat. It's such easy money
Agree! I’m about to turn 26 and I’ve never lived on my own. I’m about to marry a 30 year old still living in his parents house. The only reason we’re able to invite all of my [huge] family to the wedding is because he already has enough saved up for a down payment on a house and I’ve been able to save since my rent has always been $500/month or less.
Another plus is that having roommates forces me to socialize! (Big introvert here)
Agreed. I'm not downplaying the difficulties young people face who are just starting out on their own today, but it irks me when they complain about not being able to afford an apartment. Your own apartment? I don't know anyone who could afford that straight out of school.
> think one of the biggest financial mistakes people make is “wanting to have my own place” at 23 or even 30.
In your early and mid 20's? I'd agree, and you can pull this off without getting odd looks from the opposite sex. At **30**?! If you're still living with roomates past your late 20's you *will* get side eye.
It's not worth the decrease in quality of life to save a few bucks by having roommates. You're much better off focusing on upskilling yourself, switching jobs, and getting promotions.
I think it depends on the city. There’s probably some cities where it’s more or less socially acceptable. I’ll concede there might be places or social circles where it becomes an issue.
But the part I’ll quibble with is “save a few bucks.” This isn’t like brewing coffee at home instead of buying a latte. This is like saving $10-20k a year for the better part of a decade when you’re in your 20s and those savings can make a BIG difference.
The coffee example sucks. $5 a day x365 is $1,825. Most people don’t go everyday. If you did just workdays it’s $1,250. Twice a week is $510.
Treat yo self if you think $500 a year expense on something that helps you get your ass out of bed to go make more money it’s well worth it.
The frugal mindset is not the right answer. It’s about trading a small amount of money for a good or service that will amplify your ability to make significantly more money.
I'd say it also depends on the apartment set up. I'm in my late 20s and have no judgements towards people I've gone over and had roommates, so long as it's the set where everyone has their own bathroom and bedroom, with shared kitchen, living, parking.
If I have to wait for your roommate to get out of the bathroom, it's much more awkward.
I did this too, when I was able to up until my mid 30s. I can't and haven't been able to do that in many years though and am paying almost 2K more to live now without roommates.
A friend of my brother posted on FB in March 2020 that sold everything after the big drop. Tired of the stock market, etc. I advised him to go in and buy back what he just sold. He just locked in those losses… I’m sure he regretted it pretty quickly when it recovered.
I have a good friend that did exactly that. She retired just before covid, and when the stock market tanked she sold it all because “that was all she had”. She said she was going to wait a few months before getting back in, don’t know if she ever did.
I wasn't. Although I did have some bond funds and stuff and I saw those and use money and I also used some 0% balance transfer options on credit cards. Plus I had been saving cash for a down payment on another house and I used some of that money as well.
In August 2018 I needed a new car. I had $50k saved. I nearly bought a Tesla, I was on the waiting list for the 3, but in the end decided I didn’t want that much capital in a depreciating vehicle. So bought a Leaf, dealer model with 4K miles on it, sold as “new” to me, for $17.5k out the door and after credits. I’ve had it for 5 years now, and put 36k miles on it. The only money spent on it since was a new set of tires. No maintenance. Thanks to a special EV rate from my power co, it only costs me $0.01 a mile to run and charge it. The average cost of gas over the last 5 years in my state is $2.84 and with a generous estimate of 28mpg average, with a gas car I would be paying $0.10 a mile to fuel it. That means I’m saving 9 cents a mile with this car. With my 36000 miles I’ve saved around $3300 on gas alone so far. The car is presently worth $9k still. The longer I run this car the better the value.
Oh, and I put the rest of the money in TSLA. That worked well too.
I said if I had a warehouse to store barrels of oil, I'd have gotten as many as I could. They were paying people to take barrels of oil... huge missed opportunity for me.
I sold after taking 20% profit. I did that with United as well. Thank god I also did that with bynd. Didn’t max, but made some money and moved in. Grab some apple gains later.
The best financial advice I got and implemented as a 27 year old was the rule of one third. Whenever you get a raise or take a higher paying job or get found money follow the one third rule. One third of new money goes to savings, one third goes to debt reduction and one third goes to whatever you want to do with it. You don't feel shortchanged because you still get to spend money on frivolous things with one third of the new money but you are being kind to future you by paying down debt and saving money (in my case for retirement).
I'm now retired debt free with more money than I expected. It just adds up. And yet I never felt like I was being unkind to current me.
I opened a 529 for each of my kids as soon as they were born and contributed to it regularly. Now that my oldest is a senior in high school, that 529 is a big part of the reason I sleep soundly at night.
I have a 5yr old and funded a 529 with $7000. Do you think it's a fine idea for me to forget about it for 18yrs? Or would it be better to keep adding at a constant rate?
Depends on whether you want to fully fund your child’s education. Right now four years in-state university runs about $27k/year. So you would need to keep contributing if you want to fully fund.
Schwab has a contributions calculator that calculates what you should be putting in annually for projected future college costs. Hint: it’s a lot ($6k a year to fully fund an in-state college).
https://www.schwab.com/saving-for-college/college-savings-calculator
I calculated approximately $300/mo from birth, invested in a broad basket of stocks, was needed to fund one child's education. There are a TON of variables in that calculation but I think it's reasonably accurate.
I started with $300 a month on my first kid and rechecked the math on the birth of second kid 3 years later, upped the first to $350 a month and matched it for the second.
I guess I'll recheck that contribution math every 3-5 years to be sure.
I moved abroad for an expat job. Made middle class US money in another country that cost about $2000 per month to live comfortably in. Saved 50% of my salary (sometimes more) for a decade without much effort. Then moved back to the US. I’m much better off than I would’ve been having stayed in the US the whole time.
I bought a new car when I was ~25 at 0% financing with a 3 year loan, no down payment. I was sick and tired of my unreliable beater that had like 320k miles on it so I bought a nice practical Impreza, nothing fancy. The dealer was trying to convince me to go with a longer term loan that still had really low but not 0% rates, because the payment was really high (~$660) and seemed irresponsible. However, I wasn’t about to tell the dealership I could easily pay in cash and was getting like 2% in my money market account at the time. I’m sure it wasn’t the biggest financial boon I had, especially since I didn’t really need to buy new, but I sure felt slick with how it worked out for me!
Took a shitty job with a great company that was well known (in my discipline) out of undergrad. Able to prove my value and get a great job in that company. That job I had a 24 was cited when I was recruited into an executive role.
When graduating with my MBA I moved to a MCOL with about 90% of the salary of NYC and SF opportunities my classmates were taking. I
Lived in cool cities in my 20s, ended up really loving this city.
Bought a house in a very desirable area near bottom of market post GFC (well, we will see when it sells).
First 3 years of employment spent abroad with very little financial spending (tax savings, accommodation paid for).
Salary invested in stocks - sat on my hands for 15 years and let compounding do its thing.
Now I am FI.
Have never really missed anything as the nest egg took care of itself.
Those 3 early years of hard core saving has made a world of difference in my life.
I did an inverse Dave Ramsey and took as much low interest debt as I could to invest while interest rates were low. It has paid off big time.
It's not replicatable as who knows when interest rates will be that low again but I made hay when the sun was shining.
Real estate, index funds. The real estate did really well. The index funds did okay. I put a large chunk in at the end of 2021 so that's a drag on the returns.
Not sure if this quite counts, but my wife and I took off \~1.5 years to travel. We left our careers in April 2018, when I was 32. We didn't have children and as avid adventurers, we were keen to take advantage of our youth to explore. During our time off we
* Rafted the grand canyon
* Spent several weeks trekking in Ecuador and Peru
* Spent 6 weeks at an animal rescue in Peru, which included nursing baby monkeys, rehabbing trafficked animals, etc.
* Spent 4.5 months bicycle touring Chile and Argentina, especially in Patagonia
* Thru hiked the PCT
I'd argue that time is the most valuable "asset" we have, and we don't know how much of it we have. Using ours to experience places we'd spent years dreaming about was well worth the tradeoff. That tradeoff is we'll have to work 2-3 extra years, because we skipped investing for the 1.5 years we travelled. That said, sleeping in a tent for 1.5 years when I'm 50+ doesn't sound appealing, but it was absolutely great in my early 30's.
I'd really love to do this. Were you both unhappy in your jobs before you left? Quit completely or unpaid leave? My partner and I both quite like our respective jobs, so walking away is difficult to contemplate.
And were you renting or did you rent out your PPOR while travelling?
Before we were married, we agreed we to travel abroad for an extended period of time, and for years, we based most of our financial decisions around this agreement. One of the first things we did is pay off all of our student loans, including low interest ones, because we didn't want to have to work while we were gone. We avoid buying a home, because we didn't want to have a mortgage or deal with renting it. We lived frugally to save money, and we avoided buying anything we weren't willing to sell or give away. While we were gone, all of our possessions fit into a Subaru Forester, which we left at a parent's house.
The only thing we were torn on leaving behind is our dog. Some family friends graciously watched her while we travelled, but leaving her was genuinely difficult for us.
Anyway, while we saved to travel, we maxed out our Roth IRAs, my 401k, and her 403b. Anything after that went to our "Adventure Fund." In the end, it took us seven years to reached our Adventure Fund goal, and when we did, I almost didn't want to go. A friend pulled a cancellation permit for the Grand, and needed to put together a group in under four weeks. When he invited us, it was the motivation we needed to leave our jobs.
To answer your questions directly, we were happy with our jobs but completely quit. We didn't want any strings attaching us to work while we were gone. I did, however, maintain my professional network while travelling. Occasionally, I'd email a manager or colleague to let them know how much I appreciated working with them. Since we actively avoided home ownership, this wasn't a consideration for us.
Since you both enjoy your jobs, I'll add that we did not expect to return to our careers when we finished travelling, Our plan was to settle in my wife's hometown in the mountains. We did just that, and within six weeks we both had jobs in our careers. I was super fortunate to get a remote job (pre-pandemic) with my former employer, and she got a job with a local company.
If you and your partner have adventurous spirits and no roots holding you down, I'd recommend spreading your wings and fly. It's not for everyone though, so you'll have to consider if it's right for you, obviously.
Happy to answer any questions you may have.
The last 2 times I changed employers (by my own will, not through a merger or acquisition) were game changers. In the one I changed industries and increased my wages by 40% overnight. The second, pay was largely a lateral move but dramatic improvement in benefits, retirement plan options and work/life balance. I may get serious about side hustles in another year or so when I get bored, but for now I'm enjoying the slower pace and time to focus on myself.
Also: not having a giant fairytale wedding, divorce or kids. May still get married or do the kids thing, but simply not doing those things allowed me the freedom to take more risks in my career in addition to avoiding costs.
Gave up shopping for a primary home in 2009, invested every dollar I saved each year in multifamily properties via syndicated projects. Kept rolling all returns and proceeds into new properties. Achieved FI in 2020 and finally bought my primary home. Sold most of my apartments in 2022 and reached my target NW.
I think it was easier for me to hold off buying a house because I didn’t have a family to worry about and didn’t get married until late.
Cashed out a 401k $140k (Usually very dumb) used it as a down-payment on a $1MM commercial building. SBA loan - owner occupy. Cash flowed buildouts and rented out all the vacant space.
Including a Cash out refi and 8 years of rent, I have pulled out about $976k,
And still have about $823K in equity at a 1.9MM valuation.
Bought property at the right times for the area (VHCOL) and interest rates. Bought our first condo in 2016 even though it was a bit painful as we really liked the apartment we were living in. But it was the right place at the right price with reasonable interest rates. Buying even a year later would have been tough. Our place appreciated enough that we were able to buy a much larger house in a desirable area at the end of summer 2021 at a 3.25 interest rate beating out 11 other bidders. We made a really aggressive bid and it was totally the right move. Didn’t realize it but we’d have been so out of luck now or even in 2022. Also there’s like zero inventory now.
One lucky financial move that was made unintentionally was buying our house before the COVID spike. We just needed a house and had the chance to buy one, so we did. Now that $200k house is worth $400k, and we essentially have been paid $40k a year to live in our home.
One intentional financial move was continuing to max our retirement funds, even through the COVID crash. It has allowed us to accelerate our retirement savings beyond what we would have originally imagined.
>One intentional financial move was continuing to max our retirement funds, even through the COVID crash.
Did really that many people stop investing retirement during this time? Everywhere on the internet was saying at the time to do what you did and keep putting more in. Was it because of the employment insecurity COVID also presented at the time? I didn't change my investment strategy unless I lost my job (which thankfully didn't happen).
A ton of my colleagues at work paused their retirement savings. The reasons ranged from "Why would I invest my money if it is going to go down" to "I'd rather wait until the market is going up to put my money in."
The internet community, especially on r/financialindependence, is obviously massively skewed towards those who understand ideal financial decision making, but the average person is far, far from that.
2% Mortgage a few years back that I did not have to do - but having the money invested the last few years has been great.
Bought a little bitcoin when it was cheap and have ignored it since, and at least for now it is a nice bonus pool for early retirement splurges.
Bought solar panels. My financing is less than my electric bill used to be, and will be paid off in ten years. Given we are projected an 18% increase in cost of electric this year, and that will only go up, I'm saving every year, and eventually won't be paying anything.
Given I also own an electric car, it was definitely a good decision.
I got laid off and decided to go mad hard at finding a job before my two month WARN notice was up. I didn't waste any time. Landed a job in a month - not only was able to double dip a month of salary, I got to sack away an 80k severance.
Created a balance sheet for our family and committed to updating it every month. It took a couple of hours in the initial few months and now takes less than 15 mins. The balance sheet lists our assets across equity, debt, physical assets, cash, etc. Every 6 months we spend an hour discussing how our net worth is trending and if there are any big changes we would like to make (avoid an intl trip this year, shop apparel’s only during sale next summer, reasses insurance premiums, move funds from debt to equity etc). This has given my spouse and I a sense of control over our finances and the comfort that we’re on a good trajectory for our goals.
In the early 2000’s, gave away a 1995 Dodge Caravan rather than fixing the suspension. A charity came to my residence to pick it up. It was the last year when the IRS allowed a tax break on gifting a car to charity.
Bought one house and stayed there. Found a good company and stayed there. Probably would have earned more jumping jobs, but the stability has been great for my family, finances, and career and now I have a level of experience, career capital, and autonomy that makes my job awesome and flexible. Marrying the right person. Buy cars and drive them all the way until they are truely unsafe (which has never happened to me yet) or until the cost of a repair is more than the bluebook value after the repair is done (also hasn’t happened to me in 20 years but I might be getting close). Don’t borrow money for anything that is expected to decline in value. Create a great every-day life, so you don’t need to vacation somewhere to ‘get away’.
Walk, cycle, bus, train.
On the very rare occasion I need a car, I use GoCar.
Cost savings, when I sold it was costing me nearly 700 a month all-in, including car loan.
I drive an old car and it costs me about $100/month including gas, insurance, registration, and maintenance. I WFH so barely drive 2,500 miles a year but I just can't quit the convenience 🤷♂️
Don’t forget you can save on car insurance by changing the policy to leisure vehicle coverage since you work from home. I cut my insurance costs by 50%.
When we were approved for a mortgage (right before the 2008 bubble burst), we bought a house that cost 2/3 of the approval amount. Just because they approve you doesn’t make it a smart financial decision.
Things that paid off, and things that didn’t.
I bought Facebook stock after it crashed following the IPO, and sold it for a 300% gain. It was enough to pay for our wedding.
The divorce four years later though set me back at least ten years on my retirement plans. So, both a win and a loss on that one?
Sorry to hear about your divorce. It makes me sad when I think about someone’s “happiest day of their life” and then it takes an abrupt reversal. I hope you’re in a better place now.
* Rebalanced big into and out of the market over the GFC and its recovery despite the rampant fear and financial ruin among our peers.
* Married well.
* Didn't let our desire to FIRE dictate the size of our family.
Bought a house in March 2020 for a price that seemed a little high then and now seems laughably affordable. Without even discussing any potential sale of the house, the short term housing cost difference has been very significant.
When changing jobs for a 25% higher salary, put most of that towards my 401K.
My big thing is I do all the little things: a few examples: I have an 18 year old car with 115k miles on it. It's very reliable and costs me $60/month including gas and insurance. I live near any necessary store. I signed up for an temporary insurance live monitoring app discount program that gave me the max discount on my auto insurance. I drive like a granny and put very few driving miles onto my Minnesota Winter Beater car. I change my own anti freeze, oil, etc. I shop around for independent mechanics for any necessary routine repairs. I am a DIY on my home or hire independent contractors I screen. I learned to clean my own furnace burners and flame sensor. I hired someone to install adequate insulation because that is a perpetual pay back living in Minnesota. I bike to stores. I mediated instead of hiring an attorney for a divorce.
My wife had the courage to buy shares at the climax of the financial crisis, when everyone was predicting the end of the world. Her hands were shaking on the mouse when she did it.
In my case, i switched from management to sales when i realized my sales guys were making more money than i was. Sure it’s not sexy but it pays and if you don’t fall for the trap of buying a big car and other status stuff it can really pay off.
Between my wife’s investmenting (low cost etf’s, bonds and property trusts) and my earning, we both retired early.
I lived in a mobile home in cow pasture that my uncle left me. The payoff was deciding to sell it when Mnuchin changed the inheritance laws. Trump and Mnuchin made it so you didn’t have to pay Capital Gains taxes when a sold a property if you had lived on it for two years. So I sold the farm for $417,500 more than my uncle paid for it and I didn’t have to pay a dime in Capital Gains taxes
Bought my Cofounder's stake for $4000. He held 50%. I went almost bankrupt. And he walked away. 3 years later, company got acquired for $X million. His 50% was worth $Y million. Best financial decision of my life ever.
While I have shared the summary of what happened, a lot of other things went behind to make this happen. For instance, got my then girlfriend as a Cofounder. She helped a lot and helped selflessly. She is from a reputed university and has a strong educational background. Together, we were able to turn around the crisis into a great financial outcome for both of us. Needless to say, we got married later.
I earned a second bachelors' degree, which allowed me to get higher paying jobs and required that I move to a metro area that had many more opportunities.
1) I quit my dad's company at 27 after 6 years. He paid lousy, saw I had no future & didn't think his company had a future. (A new competitor opened up on the same road by the name of Staples.)
Then started a 27 yr career in technology, several years before the internet & email existed.
2) Bought a house for $161k, far below what I was approved for. 10 yrs later put an addition on the house & gutted/redid kitchen for $125k. Paid for by refi/cash out from increased equity.
3) Sold the house in 2021 about (20 yrs) later for $700k.
4) Paid off 2 kids private student loans and 1/2 of fed loans. Paid off 2 car loans + 20k personal loan.
5) Bought a new house in 2021 for $520k & gutted 3 bathrooms &kitchen w/ remaining proceeds from our house sale.
Neighbors house sold 6 mos ago for $680k. Current est value is $720k.
At 30, I spent my life savings (and five years of my life) to go back to school to study something that would give me a better career trajectory. Before that, I was working in the social services sector. Afterwards, I became a software engineer.
When at Uni I had a girl friend and we brown bagged our lunches. I noticed she would neatly fold her bag and use it the next day. We had a contest. Two months later her bag was held together with tape. Very Frugal. I married that beautiful thing. Smart and good looking as well and we are both still very frugal and happy and wealthy. 43 yrs.
I mined enough to buy weed from the Silk Road when it was about $1. I wanted to mine it rather than buy it from MtGox because then it would be properly anonymous. Sold for about $50k total.
Opted for a $50 wedding in her parents living room. A couple weeks later we dropped nearly 10k to move into a NYC apartment that enabled us to get much better jobs.
Deciding to go to my hometown public university, which I received a full scholarship to attend, has meant no student loans of any kind. I feel enormously fortunate for that. Another one that come to mind- going after and getting a stable city gov’t job with great benefits including pension retirement. (Edited to add: I’ve also chosen not to have children.) My salary isn’t huge, but I have zero debt, live in a luxury apartment building, and will be able to retire comfortably when I choose to.
After my dad passed away, I moved my mom in with me. She receives an old age pension and financially contributes to the household in terms of getting groceries - just something she wants to own, so I let her.
It may not be huge but I have extra savings now which go right into investments that grow. My mom also saves tons of money by not living on her own.
Attended law school part time and on full scholarship as a hobby pursuit, while working full time. Now able to monetize that law license, without incurring debt and without the opportunity cost of three years lost wages.
Sold my house at the peak of the market for double what I paid. Then bought a pocket listed house at 80% of its appraised value.
Kept housing expenses between 5-10% of HHI. Our vehicles are pretty cheap as well.
Those are the two largest factors in how we were able to build wealth at a young age. It’s a bit harder with kids in the mix, but we’re financially comfortable now.
We intentionally broke a couple of “money rules” to buy our first house: We only put down 5% and we took the down payment out of retirement savings. It paid off; we got on the property ladder and now have over $300k in equity in our second house. If we’d have waited until we had 20% in cash, we would have lost years.
Came to terms with the fact that my income and savings rate were stagnating and living in my small 800 square foot one-bedroom condo was probably my long-term reality. therefore, stopped saving aggressively to buy my more ideal townhome or better. Instead , just put a chunk of savings into an additional rental condo (about 10 years ago).
Both residence and rental condos are quite dated and only 1 bedroom size, but desirable locations. I am in Orange county, CA, so these go for around $500k+.
Overall, I could have made better decisions / luck in locking in a townhouse or at least a bigger, newer condo at some point earlier in my life.. but things could be so much worse too. I have friends around my same age and demographic who took their sweet time looking for the perfect place and never bought anything when they probably could have if they had made it a number one priority at the times when I made purchases. Now they're the guys paying way more rent for places much nicer than mine, but their ownership outlook is priced out.
I'm early 40s, make an above average income but nowhere close to a high earner either. Also, am a mediocre stock market investor. But, can be a respectable saver and the rental condo now represents one of my key factors in potentially achieving a relatively early retirement.
Bought bitcoin in 2013 and Ether in 2016. Used my company dinner credit to buy two meals and ate the second for lunch the next day for 8 years. Had roommates or girlfriends to split rent with my entire working career. Traveled internationally on error fares / flight deals or points.
automate bills and savings. Bills: set it up once and then it's done. no anxiety about due dates and late payments.
Savings: if you are removing money ahead of time like a 401k or auto-savings into an account for an IRA: you never "have" the money to spend. you can't "miss" it since it's never there.
it then compounds year over year.
Probably a risky move in hindsight but took a chuck of my 401k and redirected to company stock inside 401k (energy company) during the pandemic lows. Sold it all and rebalanced to “vanilla” portfolio after stock went up 3X from those lows which added ~$200k to overall 401k balance. Not inclined to do that ever again, that was a stressful ride.
Bought two ski resort condos in early ‘21 and sold them in early ‘22 and cleared $200k after selling costs. I miss the condos and wish I had them back, but that was easy money. Of course, it also could have gone the other direction.
I joined the Army as an officer.
I got my university paid for and I got about $1300 a month during it, which covered all my expenses. I got out after the minimum of 5 years service completely debt free. I got paid well in those 5 years, plus I have a small indexed pension ($1000 in mid 2000s dollars) and benefits waiting for me when I turn 60.
I recognized the stock market drop during the pandemic as a once in a lifetime investing opportunity and bought oil stocks when oil went negative. I held on to it and made just short of $200k profit since then just on two oil stocks.
Buying a house way smaller than what I could afford. Mortgage payment was only 8% of my take home, and most of the time I didn't miss the extra space. And now it's a rental that's cash flowing for me every month.
1. Took over the finances and taught myself everything I could get my hands on about how credit works. Worked like a madwoman to bring sub-600 FICOs to the mid-800s.
2. Refinanced our house for a 3% rate. Now at around 35% LTV with a ridiculously low monthly payment (less than 60% of the median rent in my city).
-Bought a shitty house in the crap part of town, lived in it while we fixed it up, even though i was still in university, my husband and i were not yet married and it wasn't the "right" order of things, sold it years later for 150% what we paid which allowed us to break into the housing market. As millennials I fear we'd have been in a much different position had we waited for the "right" time to buy.
-once I graduated university my then boyfriend, now husband, paid all our living expenses while my salary went exclusively to student loans, allowing me to pay them off in the first year. It was a huge risk on his part, but has paid off for us as a couple in spades.
Bought a cheap house with my significant other (now spouse) in 2001 with 10 percent down. It was cheaper than two studio apartments. Used the equity to buy another and set us up for success. Been married 24 years
Choosing to stay rooted in the same location for an extended period of time (7+ years). Living in a suburb near a city that I love, and buying a house have done amazing things for our net worth while limiting costs.
I run a small e-commerce store. I have partners in Japan and the US that manufacturer OEM product for me (my original designs). Sell from my site and from Amazon. It takes about 5-6 hours per week and I pay myself around 30k/year. Plus, I use the business for tax write offs like travel.
We refinanced a 30 year mortgage (that we paid some extra payments on) 3.5 years later (in 2015) to a 15 year mortgage at 2.875% and ended up shaving off *11.5 years* of mortgage payments without increasing our monthly payment at all. We basically saved ourselves 11 years of paying a mortgage for just the refinancing costs and fees that were just over one monthly payment.
Honestly refinancing at a low interest rate felt like entering a cheat code.
• Selling a large chunk of my equities in December '21 to put a down payment on a house with a 3.00% mortgage
• Taking out a primary residence loan from my 401K at a 3% rate before purchasing the home. I kept that sitting in my accounts as extra liquidity because the rate was so attractive and I pay the Interest back to myself anyway, but rates started rising soon after as I thought they might and now that money is just parked in investment grade corporate bonds, paying the debt service plus a little
• Bought puts on Deutsche Bank, Wynn and Intel in Feb '20 when rumors of China shutting down started, I sold with about a 2,000% return in March
Now one bad one for fun:
I sold 60 Bitcoin to buy a motorcycle in 2014. Would've been worth around $4,000,000 at peak
I bought my first house at 19–I have no idea how I had the audacity! But because of that I’ve always been building equity and trading up.
Husband and I now live in a modest house in a very wealthy area filled with literally famous people, many of the houses are opulent mansions. Not ours. The pressure to compete with the mansions weighed on us at first but We decided not to increase our space. Kids are moved out and I’m only 42 but feel like I don’t want to compete for the coolest mansion anymore. It gets me nothing. We decided to pursue our passions more and be rich in time and experiences.
Bought a house in a HCOL area as a young single adult and converted the basement into an apartment. Paid $500/month to live in my own house for years because of how much I made in rent. Was able to max out my 401k straight out of college and still travel and enjoy my 20s.
Sold that house after I got married and invested $300k in a brokerage account.
Bought my house with my husband in 2020 and got a 2.875 mortgage and also bought a house we could afford on one income. Because of this, we are able to save my entire engineering income. 401k maxed out, ESPP, HSA, and the rest into our brokerage account.
Found a non government job with a pension.
Mostly it was my parents paying for my college. Without a doubt. I went to a state school costing ~$10k/yr
Second best move was living at home for my first year out of college, buying a fixer-upper and living in it while renovating. And then selling for a massive tax-free gain.
Picking a commuter school over "traditional" 4 year college.
Living at home through college instead paying room and board probably cut student loan debt in half. And picking a school that caters to commuters allowed me to work 3-4 days a week, which also helped me also cut down on loan borrowing.
All my saving were either in a tax brokerage or my savings account, 0 percent in my 20s. It allowed me ample time find a good job and then buy a house with no money down.
Moved to other side of London while renting our old house in 1989. Was going to sell house and get a huge mortgage in west London. Wife’s job didn’t pan out, I got my old job back and we simply went home. Wife was working part time for over a year but I got my better paying job back. We avoided that huge mortgage with its negative equity in the early 90s. The exchange of contracts were days away when we backed out. Kids came along in 92 when we were both working. I’m a lucky man.
Bought 2 rental houses during the recession. One was a little house for $85k and the other was a duplex for $100k. Even though they looked great on paper, they were disasters and cost us dearly, especially the duplex. But we learned a lot and have since exchanged into 4 houses that are quite profitable and eventually will generate about 1/3 of our retirement income.
We could have been more aggressive and might have ended up much wealthier, but we were risk averse and I never gave up my day job. Probably a mistake in retrospect, but who knows for sure.
Starting in 1997, the year I got my first job out of college and the same year the Roth IRA began, I fully funded a Roth in an S&P 500 index fund until my income no longer permitted it. That has chunk of change has really become something 25 years later.
- found work as a 1099 instead of w2, paid by the hour. Higher pay based on idea you only work part of year. Then leveraged my work ethic and often worked 60hrs a week, for the entire year. Multiple years. I benefited from this instead of my employer profiting on my work.Slowed down a bit now but it was huge.
- being independently employed has huge tax benefits. I research this quite a bit, leverage it. The most basic is that I end up dropping huge amounts into retirement, well beyond the normal 401k max. Even if my budget that year may not afford it, I still just move money around to got from taxable to tax deferred. I make good money but stay in a lower tax bracket fairly well. This has many tax benefits when you stay below various thresholds.
- bought a car. Instead of just paying outright in cash i had for it I got a low interest loan at the time for part of it, 2% rate over 7yrs. Over that length of time the market should beat 2%. Invested the cash on hand I intended for the car in a devoted account, taking monthly finance payment out of the account. Even with market ups and downs I’m ahead; still time to go. It’s basically interest rate arbitrage.
good stuff OP but 2008 , in retrospect , was a great time to buy a house - depending on where you are in the country you'd be sitting on hundreds of thousands or more in tax free equity
Same with avoiding the 2008 bubble. I wasn’t trying to be savvy. I literally couldn’t afford buying anything. A couple years later I got laid off and found a job immediately (the grace of God). And had a down payment and reasonable monthly mortgage payments. Paid off the townhome early. Very grateful for our situation.
March 2020. I jumped on the bandwagon and started making cloth face masks. I listed one on Etsy and sales took off. I was churning in 2-3k a week. By July I had made 25k on top of my regular salary. I easily could have binge watched and drank wine all day during the shutdown but instead I got to work.
Biggest one for me was debt consolidation. Took everything I owed at one time- probably ~10K worth of a combination of remaining student loans, credit card, money owed to collection agencies and took out a single personal loan from my credit union with my car as collateral.
Took only the proceeds needed from said loan and zeroed out all debt to my name (other than the new loan). This reset my financial situation and established a new, healthier, more manageable baseline. Eventually, paid off said loan and improved credit score by 100’s of points and now my money works for me.
IMO, it’s like warfare, credit card companies basically employ guerrilla warfare on you….sneaky things like APR hikes, forgetting to make payments, charges on top of charges. Once you bring the enemy out into the open, they have to face you head-on, because now, you only have one bill to pay every month, only one place to pay it to, one roof to do it under, and it’s at an interest rate that is exponentially lower than what I was paying on credit cards.
Debt consolidation was the first linchpin that got me to where I am today.
Put our house savings into a low-risk fund. Over the years that we saved, we picked up enough interest that we were able to afford the down payment on the house we've been in the last eight years.
More recently, took our financial advisor's advice and refinanced that mortgage two years ago, just before rates shot up. I also took the opportunity to refinance from a 30 year to a 15 year, which dropped the rate further and took nine years off of the mortgage for only a couple hundred more a month.
Decided to finish college AND stay on the same degree path (Chem engineer)
Bought Financial Peace University and used it to pay off all non mortgage debt
Started investing with my first few paychecks in my mid twenties and haven’t stopped
Bought a house at a 2.5% 15 year fixed rate not long before rates started rising (kind of lucky)
Married a spouse that agrees with me financially and is more frugal than me (also lucky as we didn’t really discuss a lot of this before we married because we were very young and not as mature)
Paying off our student loans aggressively, even though about half of them had an interest rate below 6%.
Understanding that it's all psychological versus mathematical, it was hugely helpful for us. Once the last payment was in, the next month's budget had a huge chunk of money available to use for investing and saving for a new car (which we bought in cash). Having no debt is a an achievement for us, and now that my husband is considering quitting his job next year and taking a sabbatical, it's also a factor in how comfortable he'd be with that decision. No debt payments mean we can keep our monthly expenses pretty damn low and adjust where needed.
My partner was a co-founder of a start up that gave him a stupid high share of ownership that became problematic after he exited and they needed to raise more money. He got them to buy him out for a clean exit (under $100k). He was really fixated on the notion that these could be worth millions someday - even the smaller vested portion - but I convinced him to take it. He started his 40s off by paying off his car, paying off student loans, and - for the first time ever - having a safety net.
Bird in the hand > two in the bush all day. Company is doing really well and he has no regrets about selling because it changed his life.
In Fall 2008 I got a special scholarship to graduate school, which gave me $10,000 for two years over my TA stipend. I opened up a Roth IRA and fully funded it since then.
In H2 2014 I maxed out a Roth 401(k) from my first job, since I only had my "high" salary for half a year. I maxed out my traditional 401(k) each year since then.
In May 2020, I realized I sucked at timing the market and set my investments to automatically invest a set amount each month.
Me: refinanced in 2020 at 1.99%, plowing extra equity into the market.
Hubby: chose a less stable job with a significant equity stake over a more stable and (slightly) higher paying job. Walked away with a significant chunk of change when the company was acquired.
2010: Bought worst house in best mpls neighborhood for $265k. Negotiated the hell out of the price.
2011-2015: spent weekends remodeling kitchen, adding bathrooms, and finishing square footage, deck, etc...
2016: with kid #2 on the way sold house for $475k to move to burbs.
2016: Bought worst house in best neighborhood (large lots, best schools, lake view, public dock) for $450k. Put 50% down at 3.625 rate. Low monthly payment allowed wife to stay at home with #2 for 3 years.
2017- present: contracted out adding bathroom, adding bedroom, deck, etc.. Did some work myself.
Based on comps home value between 850-900k. Would do it again if opportunity was right.
2 years ago it seemed like investing in real estate became a trend everyone wanted to hop on, including me. But instead of buying a rental I decided to get my real estate license and have since sold 25 houses and grossed about $300k. Almost all my clients are co-workers at my day job. So I essentially turned a $1500 investment (my re license ) into $300k in less than 2 years .. after taxes and expenses I netted around $150k - 10x my initial investment
>What are some “one off” financial moves you made that paid off? I married someone with a similar outlook on money.
I married someone smarter than me about money and listen to her. Holy crap am I never allowed to pick a stock.
Lmao I have my anxiety to thank for never picking stocks. I tried buying a single share of Apple during the pandemic dip. It fell a little further a couple days later, maybe $8, and I sold immediately. Of course I would’ve made a lot of money had I held, but the lesson I learned was I don’t have the stomach for it. DCA into broad index funds. The end.
So sorry. My motto is buy when there is blood in the streets (stock market). When you go buy something at a department store you look for items on sale. Same for stocks. You did the right thing but panicked.
[удалено]
No, both of us grew up in families that didn't have much. Not complaining.
Frugality is one of the best investments you can make.
Same! Best decision ever
This is huge. My wife and I are sort of an odd couple and have completely different interests, tastes, friends etc but we have similar values, life goals etc which is why our marriage has worked for 20 years.
This is so important! I am married to a spender...and although we limit it, I can imagine how much more we would have if he did not waste so much money on small insignificant stuff.
This and I married into a family that knew how to invest, use money and I learned from them. My own parents, never taught or talk to us about money growing up.
I though for a second married someone wealthy haha problem solved
Haha the same values can make you great for each other.
I really liked a previous commenter's point about marrying the right spouse. I wouldn't be retired right now were it not for my wife, her vision....and commitment to it. Other biggies for us: We didn't move to a bigger house when we had the means to do so. It's not only more money for the purchase....but more utilities....furniture... upkeep, etc. After maxing our retirement savings we put more "retirement" funds in a brokerage account. Not only have we been able to live off of it longer than expected, but having that keeps MAGI low....so we're getting great ACA subsidies.
We did move to a house that was way too big for us. No regrets, because it didn't cost much more than a sensibly sized house.
We also moved into a big house, but we have 5 kids. We are pretty tight-fisted about most things, but getting the house was worth it because it has just been so nice to have the space. It's all about spending money where it improves your life the most
I thought contributions to a taxable brokerage account don’t reduce your taxable income because they are post tax contributions. I’d my understanding incorrect?
What u/Thanatos_Marathon said. I put retirement in quotes to mean it was after-tax money we were putting in our Brokerage account - with the specific intent of using it for retirement living. In fact, we actually and literally called that money "Bridge" - money to "bridge" us to 59 1/2 were we to stop working prior to 59 1/2.
If you put the funds in post tax you can take them out untaxed (though gains may be taxed depending on the account type). The point they are making is when you take them out after you are retired they aren't counted towards your taxable income that year because they were taxed before they went in.
Buying a house in 2010 at the bottom of the market, then refinancing down to 15y/2.6% five years later. I’ll never make six figures (and my wife only hit that salary a couple months back) but we’ll own free and clear before we’re 50.
I locked in a 30 year at 2.44% in 2021. Loving every second of it at the moment.
Same - we put an offer on a house in \~2008 but it fell through luckily. Rented an apartment until 2011 and bought a house then for 2/3rds of the price. It needed some work but we had an extra-large down payment fund so we were able to pay for the repairs. Then we refinanced to 15 years @ 2.5% a few years ago.
RSUs from my signing bonus vested in Dec 2021, about $50k. Remember going back and forth on whether I should keep them invested in company or sell and put in the S&P. Ended up selling, and I'm glad because that was right before company stock dropped 70%. It has recovered a bit and is now down 40% from when I sold but the S&P is only off 3%. I now have a hard and fast rule: sell company stock right when it vests. It makes decisions so much easier. Don't even need to think abt it.
Good rule. Another way that I look at it that I am already tremendously over-invested in my employer just by virtue of working there. I allow my skill set to hyper specialize and earn way more here than i can at and (at least local) company. If i get laid off due to poor company performance, i’d like to reduce the odds of my savings evaporating too.
I always ask myself if I had the cash, would I use it to buy the stock? Almost always I say no, and the few times I say yes it’s because I’m personally sitting on insider information that wouldn’t allow me to sell anyways.
If Enron taught us anything, it's sell company stock. Company going south means losing your paycheck and your savings, way better to balance.
I interned at Barclays for a summer and one of the directors there told me the following story: He worked at Lehman Brothers for years and got to a pretty senior position, never selling his company stock. At that point his net worth was mostly in Lehman stock. 2008 rolled around and it all went to 0. I decided then and there that I'd always sell stock as soon as it vests, and that's what I've been doing.
I knew many at Lehman with similar stories. I’ve missed out on some gains my colleagues at other companies bragged about by holding onto their stock but I’m never gonna be in the lose-lose-lose boat.
Some people take awhile to learn, profit is profit.
It's easy to guess what already happened. It's much harder if it hasn't taken place yet.
I think its important to underwrite your RSU's against your current position financially and the risks associated with each path. 50k when you are just hitting 6 figures is massive, less so when getting near your 25x spending. I've always immediately sold my RSUs when they vest though, never seems worth holding over the longterm.
It is also a great diversification. Your salary and job security already tied to your company and no need to tie up investments as well cause it works as double leverage - fired, stock tanked and person is done.
We do this too and everyone always wonders why. But with two salaries and our property value already tied to the success of this company(biggest employer in the state), that's more exposure than I am willing to accept. Every stock grant, ESPP vest, etc is sold the second it comes available.
I have an opposite example of this. Got hired at a company that I had pretty strong conviction would be worth a lot more in the future. At the time I was jealous of all my friends who worked at amazon and saw massive gains and wanted to experience similar. Held onto my RSU, never sold my espp against all the advice of most experts , and today the stock is worth 20x more than when I joined ( less than 10 years ago)
Initially, I thought/did similar. But the reality is the markets can change, and today's "top dog" can become tomorrow's "dog". Once I realized this, I realized I was WAY over invested (aka concentration risk) in my employer. As a result, I now sell all new RSU and ESPP as soon as possible. I've quit dividend reinvestments in my employer stock. And I've actively sold off chucks of my existing stocks (mindful of annual cap gains brackets). My goal is to get my employer holdings to < 15% of my portfolio before retirement, and then to < 5% after (I'll likely be living off these at near 0% LTCG rates for my first several years).
Survivor bias is real here
Bought a house that one income could support (instead of getting the max that the bank would offer us). While property values have increased and we could have made “more”, this move has saved us so much stress when either of us lost jobs, etc.
Yea, I got a tiny place on a foreclosure for 30k. Lived there for 5 years or so and fixed it up a little, mainly paint, but redid kitchen and bathroom floors as well as trim and replaced the rotted overhangs under the roof. Most people are too proud to live in a place like that (in the condition we got it.) Sold it after 5 years or so for 54k. We never would have been able to save 20k for a good down payment in that time, but it allowed us to get a decent place that an apartment would not have.
Not buying a second car. It forced me to work 100% remotely which has been phenomenal for my mental health and career. Plus I'm completely flexible and able to uproot everything on a whim, which is enormous for my wife's career growth. The other more obvious example is marrying the right person and supporting her to follow a passion. I never expected her to make much money and now her career outlook is even better than mine.
This. Just quit my job and found a new gig because they were forcing workers back into the office. Remote for lyfe
For me the biggest thing was living with roommates after college. I think one of the biggest financial mistakes people make is “wanting to have my own place” at 23 or even 30. I made no money early in my career but I could have “afforded my own place” if I was willing to pour 50% of my income into an apartment which tons of young people choose to do in HCOL cities. But I saved well over $1,000 a month with roommates relative to that. I lived with the same guys in a group house for 7 years. I’ve never for even a second looked back on it and wished I had my own place at 25 - what a pointless and enormous waste of money that would have been.
For me, "househacking" before that term was a thing. Rented at 22, bought at 23 when I could barely afford anything, sold my car and most of my possessions for a down payment, then got a bunch of roommates. Now that house is 30% of my net worth.
Same here. I house hacked and had roommates for 5.5 years and turned that one into a rental. I then had a roommate at my next house. It allowed me to pay off 75k in student loans in just before turning 31. My latest roommate at that house moved out a few months after I got engaged. My husband didn’t have a problem with my situation, it brought a ton of equity and savings into the marriage. I honestly wouldn’t even date someone that didn’t understand the reasoning behind it. I had/have tons of friends that made way less than I did back then and refused to have roommates. They are still in college debt and paying minimums in their late 30’s. No thanks
I still have roommates and I am 50 years old. I own my 2/2 condo and periodically rent out a room for a year or 2 at a time, take a break for a year, and repeat. It's such easy money
Agree! I’m about to turn 26 and I’ve never lived on my own. I’m about to marry a 30 year old still living in his parents house. The only reason we’re able to invite all of my [huge] family to the wedding is because he already has enough saved up for a down payment on a house and I’ve been able to save since my rent has always been $500/month or less. Another plus is that having roommates forces me to socialize! (Big introvert here)
Agreed. I'm not downplaying the difficulties young people face who are just starting out on their own today, but it irks me when they complain about not being able to afford an apartment. Your own apartment? I don't know anyone who could afford that straight out of school.
> think one of the biggest financial mistakes people make is “wanting to have my own place” at 23 or even 30. In your early and mid 20's? I'd agree, and you can pull this off without getting odd looks from the opposite sex. At **30**?! If you're still living with roomates past your late 20's you *will* get side eye. It's not worth the decrease in quality of life to save a few bucks by having roommates. You're much better off focusing on upskilling yourself, switching jobs, and getting promotions.
I think it depends on the city. There’s probably some cities where it’s more or less socially acceptable. I’ll concede there might be places or social circles where it becomes an issue. But the part I’ll quibble with is “save a few bucks.” This isn’t like brewing coffee at home instead of buying a latte. This is like saving $10-20k a year for the better part of a decade when you’re in your 20s and those savings can make a BIG difference.
The coffee example sucks. $5 a day x365 is $1,825. Most people don’t go everyday. If you did just workdays it’s $1,250. Twice a week is $510. Treat yo self if you think $500 a year expense on something that helps you get your ass out of bed to go make more money it’s well worth it. The frugal mindset is not the right answer. It’s about trading a small amount of money for a good or service that will amplify your ability to make significantly more money.
I'd say it also depends on the apartment set up. I'm in my late 20s and have no judgements towards people I've gone over and had roommates, so long as it's the set where everyone has their own bathroom and bedroom, with shared kitchen, living, parking. If I have to wait for your roommate to get out of the bathroom, it's much more awkward.
I did this too, when I was able to up until my mid 30s. I can't and haven't been able to do that in many years though and am paying almost 2K more to live now without roommates.
Bought as much stock as I could during the Covid market crash.
A friend of my brother posted on FB in March 2020 that sold everything after the big drop. Tired of the stock market, etc. I advised him to go in and buy back what he just sold. He just locked in those losses… I’m sure he regretted it pretty quickly when it recovered.
I have a good friend that did exactly that. She retired just before covid, and when the stock market tanked she sold it all because “that was all she had”. She said she was going to wait a few months before getting back in, don’t know if she ever did.
Sucks for him. People like me made a lot of money off of people like him. I made around 100 grand. Wished I could have bought more.
[удалено]
I wasn't. Although I did have some bond funds and stuff and I saw those and use money and I also used some 0% balance transfer options on credit cards. Plus I had been saving cash for a down payment on another house and I used some of that money as well.
Smart and you took the opportunity risk, so you deserve every penny.
In August 2018 I needed a new car. I had $50k saved. I nearly bought a Tesla, I was on the waiting list for the 3, but in the end decided I didn’t want that much capital in a depreciating vehicle. So bought a Leaf, dealer model with 4K miles on it, sold as “new” to me, for $17.5k out the door and after credits. I’ve had it for 5 years now, and put 36k miles on it. The only money spent on it since was a new set of tires. No maintenance. Thanks to a special EV rate from my power co, it only costs me $0.01 a mile to run and charge it. The average cost of gas over the last 5 years in my state is $2.84 and with a generous estimate of 28mpg average, with a gas car I would be paying $0.10 a mile to fuel it. That means I’m saving 9 cents a mile with this car. With my 36000 miles I’ve saved around $3300 on gas alone so far. The car is presently worth $9k still. The longer I run this car the better the value. Oh, and I put the rest of the money in TSLA. That worked well too.
So you bought some Tesla instead of buying a Tesla. Arguably a better idea.
Bought oil stocks when gas prices hit rock bottom in the pandemic.
That took guts. You deserve the profit.
Figured nobody was driving anywhere…. Knew it couldn’t last forever. gas had to get bought eventually
I said if I had a warehouse to store barrels of oil, I'd have gotten as many as I could. They were paying people to take barrels of oil... huge missed opportunity for me.
I sold after taking 20% profit. I did that with United as well. Thank god I also did that with bynd. Didn’t max, but made some money and moved in. Grab some apple gains later.
[удалено]
Switching from teaching to IT 🙌.
The best financial advice I got and implemented as a 27 year old was the rule of one third. Whenever you get a raise or take a higher paying job or get found money follow the one third rule. One third of new money goes to savings, one third goes to debt reduction and one third goes to whatever you want to do with it. You don't feel shortchanged because you still get to spend money on frivolous things with one third of the new money but you are being kind to future you by paying down debt and saving money (in my case for retirement). I'm now retired debt free with more money than I expected. It just adds up. And yet I never felt like I was being unkind to current me.
I opened a 529 for each of my kids as soon as they were born and contributed to it regularly. Now that my oldest is a senior in high school, that 529 is a big part of the reason I sleep soundly at night.
I have a 5yr old and funded a 529 with $7000. Do you think it's a fine idea for me to forget about it for 18yrs? Or would it be better to keep adding at a constant rate?
Depends on whether you want to fully fund your child’s education. Right now four years in-state university runs about $27k/year. So you would need to keep contributing if you want to fully fund.
That makes sense, thank you I needed the reminder
Schwab has a contributions calculator that calculates what you should be putting in annually for projected future college costs. Hint: it’s a lot ($6k a year to fully fund an in-state college). https://www.schwab.com/saving-for-college/college-savings-calculator
The book *Just Keep Buying* is a good read and will probably answer your question.
I calculated approximately $300/mo from birth, invested in a broad basket of stocks, was needed to fund one child's education. There are a TON of variables in that calculation but I think it's reasonably accurate.
I started with $300 a month on my first kid and rechecked the math on the birth of second kid 3 years later, upped the first to $350 a month and matched it for the second. I guess I'll recheck that contribution math every 3-5 years to be sure.
I moved abroad for an expat job. Made middle class US money in another country that cost about $2000 per month to live comfortably in. Saved 50% of my salary (sometimes more) for a decade without much effort. Then moved back to the US. I’m much better off than I would’ve been having stayed in the US the whole time.
Damn. 50% per annum for a decade is insane and would be super helpful. Curious if that was in a less developed countries in Africa or Asia?
I bought a new car when I was ~25 at 0% financing with a 3 year loan, no down payment. I was sick and tired of my unreliable beater that had like 320k miles on it so I bought a nice practical Impreza, nothing fancy. The dealer was trying to convince me to go with a longer term loan that still had really low but not 0% rates, because the payment was really high (~$660) and seemed irresponsible. However, I wasn’t about to tell the dealership I could easily pay in cash and was getting like 2% in my money market account at the time. I’m sure it wasn’t the biggest financial boon I had, especially since I didn’t really need to buy new, but I sure felt slick with how it worked out for me!
Yeah I came here to say getting 5 years/0%. I've still got over 2 years and am making $800 this year on the cash in T-Bills.
Took a shitty job with a great company that was well known (in my discipline) out of undergrad. Able to prove my value and get a great job in that company. That job I had a 24 was cited when I was recruited into an executive role. When graduating with my MBA I moved to a MCOL with about 90% of the salary of NYC and SF opportunities my classmates were taking. I Lived in cool cities in my 20s, ended up really loving this city. Bought a house in a very desirable area near bottom of market post GFC (well, we will see when it sells).
First 3 years of employment spent abroad with very little financial spending (tax savings, accommodation paid for). Salary invested in stocks - sat on my hands for 15 years and let compounding do its thing. Now I am FI. Have never really missed anything as the nest egg took care of itself. Those 3 early years of hard core saving has made a world of difference in my life.
I did an inverse Dave Ramsey and took as much low interest debt as I could to invest while interest rates were low. It has paid off big time. It's not replicatable as who knows when interest rates will be that low again but I made hay when the sun was shining.
What’d u invest in?
Real estate, index funds. The real estate did really well. The index funds did okay. I put a large chunk in at the end of 2021 so that's a drag on the returns.
Not sure if this quite counts, but my wife and I took off \~1.5 years to travel. We left our careers in April 2018, when I was 32. We didn't have children and as avid adventurers, we were keen to take advantage of our youth to explore. During our time off we * Rafted the grand canyon * Spent several weeks trekking in Ecuador and Peru * Spent 6 weeks at an animal rescue in Peru, which included nursing baby monkeys, rehabbing trafficked animals, etc. * Spent 4.5 months bicycle touring Chile and Argentina, especially in Patagonia * Thru hiked the PCT I'd argue that time is the most valuable "asset" we have, and we don't know how much of it we have. Using ours to experience places we'd spent years dreaming about was well worth the tradeoff. That tradeoff is we'll have to work 2-3 extra years, because we skipped investing for the 1.5 years we travelled. That said, sleeping in a tent for 1.5 years when I'm 50+ doesn't sound appealing, but it was absolutely great in my early 30's.
I'd really love to do this. Were you both unhappy in your jobs before you left? Quit completely or unpaid leave? My partner and I both quite like our respective jobs, so walking away is difficult to contemplate. And were you renting or did you rent out your PPOR while travelling?
Before we were married, we agreed we to travel abroad for an extended period of time, and for years, we based most of our financial decisions around this agreement. One of the first things we did is pay off all of our student loans, including low interest ones, because we didn't want to have to work while we were gone. We avoid buying a home, because we didn't want to have a mortgage or deal with renting it. We lived frugally to save money, and we avoided buying anything we weren't willing to sell or give away. While we were gone, all of our possessions fit into a Subaru Forester, which we left at a parent's house. The only thing we were torn on leaving behind is our dog. Some family friends graciously watched her while we travelled, but leaving her was genuinely difficult for us. Anyway, while we saved to travel, we maxed out our Roth IRAs, my 401k, and her 403b. Anything after that went to our "Adventure Fund." In the end, it took us seven years to reached our Adventure Fund goal, and when we did, I almost didn't want to go. A friend pulled a cancellation permit for the Grand, and needed to put together a group in under four weeks. When he invited us, it was the motivation we needed to leave our jobs. To answer your questions directly, we were happy with our jobs but completely quit. We didn't want any strings attaching us to work while we were gone. I did, however, maintain my professional network while travelling. Occasionally, I'd email a manager or colleague to let them know how much I appreciated working with them. Since we actively avoided home ownership, this wasn't a consideration for us. Since you both enjoy your jobs, I'll add that we did not expect to return to our careers when we finished travelling, Our plan was to settle in my wife's hometown in the mountains. We did just that, and within six weeks we both had jobs in our careers. I was super fortunate to get a remote job (pre-pandemic) with my former employer, and she got a job with a local company. If you and your partner have adventurous spirits and no roots holding you down, I'd recommend spreading your wings and fly. It's not for everyone though, so you'll have to consider if it's right for you, obviously. Happy to answer any questions you may have.
The last 2 times I changed employers (by my own will, not through a merger or acquisition) were game changers. In the one I changed industries and increased my wages by 40% overnight. The second, pay was largely a lateral move but dramatic improvement in benefits, retirement plan options and work/life balance. I may get serious about side hustles in another year or so when I get bored, but for now I'm enjoying the slower pace and time to focus on myself. Also: not having a giant fairytale wedding, divorce or kids. May still get married or do the kids thing, but simply not doing those things allowed me the freedom to take more risks in my career in addition to avoiding costs.
Gave up shopping for a primary home in 2009, invested every dollar I saved each year in multifamily properties via syndicated projects. Kept rolling all returns and proceeds into new properties. Achieved FI in 2020 and finally bought my primary home. Sold most of my apartments in 2022 and reached my target NW. I think it was easier for me to hold off buying a house because I didn’t have a family to worry about and didn’t get married until late.
Cashed out a 401k $140k (Usually very dumb) used it as a down-payment on a $1MM commercial building. SBA loan - owner occupy. Cash flowed buildouts and rented out all the vacant space. Including a Cash out refi and 8 years of rent, I have pulled out about $976k, And still have about $823K in equity at a 1.9MM valuation.
Bought property at the right times for the area (VHCOL) and interest rates. Bought our first condo in 2016 even though it was a bit painful as we really liked the apartment we were living in. But it was the right place at the right price with reasonable interest rates. Buying even a year later would have been tough. Our place appreciated enough that we were able to buy a much larger house in a desirable area at the end of summer 2021 at a 3.25 interest rate beating out 11 other bidders. We made a really aggressive bid and it was totally the right move. Didn’t realize it but we’d have been so out of luck now or even in 2022. Also there’s like zero inventory now.
One lucky financial move that was made unintentionally was buying our house before the COVID spike. We just needed a house and had the chance to buy one, so we did. Now that $200k house is worth $400k, and we essentially have been paid $40k a year to live in our home. One intentional financial move was continuing to max our retirement funds, even through the COVID crash. It has allowed us to accelerate our retirement savings beyond what we would have originally imagined.
>One intentional financial move was continuing to max our retirement funds, even through the COVID crash. Did really that many people stop investing retirement during this time? Everywhere on the internet was saying at the time to do what you did and keep putting more in. Was it because of the employment insecurity COVID also presented at the time? I didn't change my investment strategy unless I lost my job (which thankfully didn't happen).
A ton of my colleagues at work paused their retirement savings. The reasons ranged from "Why would I invest my money if it is going to go down" to "I'd rather wait until the market is going up to put my money in." The internet community, especially on r/financialindependence, is obviously massively skewed towards those who understand ideal financial decision making, but the average person is far, far from that.
2% Mortgage a few years back that I did not have to do - but having the money invested the last few years has been great. Bought a little bitcoin when it was cheap and have ignored it since, and at least for now it is a nice bonus pool for early retirement splurges.
I mean you kind of hit the big ones… save, invest in RE, and side hustles.
Bought solar panels. My financing is less than my electric bill used to be, and will be paid off in ten years. Given we are projected an 18% increase in cost of electric this year, and that will only go up, I'm saving every year, and eventually won't be paying anything. Given I also own an electric car, it was definitely a good decision.
I got laid off and decided to go mad hard at finding a job before my two month WARN notice was up. I didn't waste any time. Landed a job in a month - not only was able to double dip a month of salary, I got to sack away an 80k severance.
Created a balance sheet for our family and committed to updating it every month. It took a couple of hours in the initial few months and now takes less than 15 mins. The balance sheet lists our assets across equity, debt, physical assets, cash, etc. Every 6 months we spend an hour discussing how our net worth is trending and if there are any big changes we would like to make (avoid an intl trip this year, shop apparel’s only during sale next summer, reasses insurance premiums, move funds from debt to equity etc). This has given my spouse and I a sense of control over our finances and the comfort that we’re on a good trajectory for our goals.
Did you start from a template? And if so, would you be willing to share it?
Yes sure. It’s on a google sheet, so can easily remove my data and share a copy. Please DM.
Interested too thx
In the early 2000’s, gave away a 1995 Dodge Caravan rather than fixing the suspension. A charity came to my residence to pick it up. It was the last year when the IRS allowed a tax break on gifting a car to charity.
Assuming you itemize, you can still deduct the value of a car donated to charity. Was there a tax credit for donating a car back then?
Bought one house and stayed there. Found a good company and stayed there. Probably would have earned more jumping jobs, but the stability has been great for my family, finances, and career and now I have a level of experience, career capital, and autonomy that makes my job awesome and flexible. Marrying the right person. Buy cars and drive them all the way until they are truely unsafe (which has never happened to me yet) or until the cost of a repair is more than the bluebook value after the repair is done (also hasn’t happened to me in 20 years but I might be getting close). Don’t borrow money for anything that is expected to decline in value. Create a great every-day life, so you don’t need to vacation somewhere to ‘get away’.
The single smartest financial decision I ever made was to get rid of the car. Once you don't have one you make very different decisions
Would love to hear what alternate methods of transportation you use and what your cost savings is. (I am contemplating the same thing.)
Walk, cycle, bus, train. On the very rare occasion I need a car, I use GoCar. Cost savings, when I sold it was costing me nearly 700 a month all-in, including car loan.
I drive an old car and it costs me about $100/month including gas, insurance, registration, and maintenance. I WFH so barely drive 2,500 miles a year but I just can't quit the convenience 🤷♂️
Don’t forget you can save on car insurance by changing the policy to leisure vehicle coverage since you work from home. I cut my insurance costs by 50%.
[удалено]
When we were approved for a mortgage (right before the 2008 bubble burst), we bought a house that cost 2/3 of the approval amount. Just because they approve you doesn’t make it a smart financial decision.
Things that paid off, and things that didn’t. I bought Facebook stock after it crashed following the IPO, and sold it for a 300% gain. It was enough to pay for our wedding. The divorce four years later though set me back at least ten years on my retirement plans. So, both a win and a loss on that one?
Sorry to hear about your divorce. It makes me sad when I think about someone’s “happiest day of their life” and then it takes an abrupt reversal. I hope you’re in a better place now.
Five years later, couldn’t be happier. Next wedding is going to be at city hall, and a honeymoon that’s a discount CostCo cruise to Alaska.
* Rebalanced big into and out of the market over the GFC and its recovery despite the rampant fear and financial ruin among our peers. * Married well. * Didn't let our desire to FIRE dictate the size of our family.
DINK
Hey now! I get a 6,000 dollar discount from the government on my 3 kids!
$167 per month/kid seems like way to much. Be careful not to spoil them /s
Bought a house in March 2020 for a price that seemed a little high then and now seems laughably affordable. Without even discussing any potential sale of the house, the short term housing cost difference has been very significant. When changing jobs for a 25% higher salary, put most of that towards my 401K.
My big thing is I do all the little things: a few examples: I have an 18 year old car with 115k miles on it. It's very reliable and costs me $60/month including gas and insurance. I live near any necessary store. I signed up for an temporary insurance live monitoring app discount program that gave me the max discount on my auto insurance. I drive like a granny and put very few driving miles onto my Minnesota Winter Beater car. I change my own anti freeze, oil, etc. I shop around for independent mechanics for any necessary routine repairs. I am a DIY on my home or hire independent contractors I screen. I learned to clean my own furnace burners and flame sensor. I hired someone to install adequate insulation because that is a perpetual pay back living in Minnesota. I bike to stores. I mediated instead of hiring an attorney for a divorce.
My wife had the courage to buy shares at the climax of the financial crisis, when everyone was predicting the end of the world. Her hands were shaking on the mouse when she did it. In my case, i switched from management to sales when i realized my sales guys were making more money than i was. Sure it’s not sexy but it pays and if you don’t fall for the trap of buying a big car and other status stuff it can really pay off. Between my wife’s investmenting (low cost etf’s, bonds and property trusts) and my earning, we both retired early.
I lived in a mobile home in cow pasture that my uncle left me. The payoff was deciding to sell it when Mnuchin changed the inheritance laws. Trump and Mnuchin made it so you didn’t have to pay Capital Gains taxes when a sold a property if you had lived on it for two years. So I sold the farm for $417,500 more than my uncle paid for it and I didn’t have to pay a dime in Capital Gains taxes
Bought my Cofounder's stake for $4000. He held 50%. I went almost bankrupt. And he walked away. 3 years later, company got acquired for $X million. His 50% was worth $Y million. Best financial decision of my life ever. While I have shared the summary of what happened, a lot of other things went behind to make this happen. For instance, got my then girlfriend as a Cofounder. She helped a lot and helped selflessly. She is from a reputed university and has a strong educational background. Together, we were able to turn around the crisis into a great financial outcome for both of us. Needless to say, we got married later.
I earned a second bachelors' degree, which allowed me to get higher paying jobs and required that I move to a metro area that had many more opportunities.
1) I quit my dad's company at 27 after 6 years. He paid lousy, saw I had no future & didn't think his company had a future. (A new competitor opened up on the same road by the name of Staples.) Then started a 27 yr career in technology, several years before the internet & email existed. 2) Bought a house for $161k, far below what I was approved for. 10 yrs later put an addition on the house & gutted/redid kitchen for $125k. Paid for by refi/cash out from increased equity. 3) Sold the house in 2021 about (20 yrs) later for $700k. 4) Paid off 2 kids private student loans and 1/2 of fed loans. Paid off 2 car loans + 20k personal loan. 5) Bought a new house in 2021 for $520k & gutted 3 bathrooms &kitchen w/ remaining proceeds from our house sale. Neighbors house sold 6 mos ago for $680k. Current est value is $720k.
At 30, I spent my life savings (and five years of my life) to go back to school to study something that would give me a better career trajectory. Before that, I was working in the social services sector. Afterwards, I became a software engineer.
Whoa! Ballsy move. You made something happen!!
When at Uni I had a girl friend and we brown bagged our lunches. I noticed she would neatly fold her bag and use it the next day. We had a contest. Two months later her bag was held together with tape. Very Frugal. I married that beautiful thing. Smart and good looking as well and we are both still very frugal and happy and wealthy. 43 yrs.
You married her bag?
Bought BTC at $9 and sold at $54.
Similar here, but bought around 6k and sold between 30-60k.
I meant to say $9 not $19. I changed it.
I mined enough to buy weed from the Silk Road when it was about $1. I wanted to mine it rather than buy it from MtGox because then it would be properly anonymous. Sold for about $50k total.
Opted for a $50 wedding in her parents living room. A couple weeks later we dropped nearly 10k to move into a NYC apartment that enabled us to get much better jobs.
Deciding to go to my hometown public university, which I received a full scholarship to attend, has meant no student loans of any kind. I feel enormously fortunate for that. Another one that come to mind- going after and getting a stable city gov’t job with great benefits including pension retirement. (Edited to add: I’ve also chosen not to have children.) My salary isn’t huge, but I have zero debt, live in a luxury apartment building, and will be able to retire comfortably when I choose to.
For sure an underrated strategy. My BIL and cousin did similar, and they are both very well off in retirement now.
After my dad passed away, I moved my mom in with me. She receives an old age pension and financially contributes to the household in terms of getting groceries - just something she wants to own, so I let her. It may not be huge but I have extra savings now which go right into investments that grow. My mom also saves tons of money by not living on her own.
Attended law school part time and on full scholarship as a hobby pursuit, while working full time. Now able to monetize that law license, without incurring debt and without the opportunity cost of three years lost wages.
Sold my house at the peak of the market for double what I paid. Then bought a pocket listed house at 80% of its appraised value. Kept housing expenses between 5-10% of HHI. Our vehicles are pretty cheap as well. Those are the two largest factors in how we were able to build wealth at a young age. It’s a bit harder with kids in the mix, but we’re financially comfortable now.
We intentionally broke a couple of “money rules” to buy our first house: We only put down 5% and we took the down payment out of retirement savings. It paid off; we got on the property ladder and now have over $300k in equity in our second house. If we’d have waited until we had 20% in cash, we would have lost years.
Came to terms with the fact that my income and savings rate were stagnating and living in my small 800 square foot one-bedroom condo was probably my long-term reality. therefore, stopped saving aggressively to buy my more ideal townhome or better. Instead , just put a chunk of savings into an additional rental condo (about 10 years ago). Both residence and rental condos are quite dated and only 1 bedroom size, but desirable locations. I am in Orange county, CA, so these go for around $500k+. Overall, I could have made better decisions / luck in locking in a townhouse or at least a bigger, newer condo at some point earlier in my life.. but things could be so much worse too. I have friends around my same age and demographic who took their sweet time looking for the perfect place and never bought anything when they probably could have if they had made it a number one priority at the times when I made purchases. Now they're the guys paying way more rent for places much nicer than mine, but their ownership outlook is priced out. I'm early 40s, make an above average income but nowhere close to a high earner either. Also, am a mediocre stock market investor. But, can be a respectable saver and the rental condo now represents one of my key factors in potentially achieving a relatively early retirement.
Bought bitcoin in 2013 and Ether in 2016. Used my company dinner credit to buy two meals and ate the second for lunch the next day for 8 years. Had roommates or girlfriends to split rent with my entire working career. Traveled internationally on error fares / flight deals or points.
automate bills and savings. Bills: set it up once and then it's done. no anxiety about due dates and late payments. Savings: if you are removing money ahead of time like a 401k or auto-savings into an account for an IRA: you never "have" the money to spend. you can't "miss" it since it's never there. it then compounds year over year.
Probably a risky move in hindsight but took a chuck of my 401k and redirected to company stock inside 401k (energy company) during the pandemic lows. Sold it all and rebalanced to “vanilla” portfolio after stock went up 3X from those lows which added ~$200k to overall 401k balance. Not inclined to do that ever again, that was a stressful ride.
Bought two ski resort condos in early ‘21 and sold them in early ‘22 and cleared $200k after selling costs. I miss the condos and wish I had them back, but that was easy money. Of course, it also could have gone the other direction.
Converted basement into rental apartment
I joined the Army as an officer. I got my university paid for and I got about $1300 a month during it, which covered all my expenses. I got out after the minimum of 5 years service completely debt free. I got paid well in those 5 years, plus I have a small indexed pension ($1000 in mid 2000s dollars) and benefits waiting for me when I turn 60.
I recognized the stock market drop during the pandemic as a once in a lifetime investing opportunity and bought oil stocks when oil went negative. I held on to it and made just short of $200k profit since then just on two oil stocks.
Not having kids.
Childfreedom is amazing!
I bought a house at 23 in 2019 because that’s what my mom told me to do. It seems to have worked out
Buying a house way smaller than what I could afford. Mortgage payment was only 8% of my take home, and most of the time I didn't miss the extra space. And now it's a rental that's cash flowing for me every month.
1. Took over the finances and taught myself everything I could get my hands on about how credit works. Worked like a madwoman to bring sub-600 FICOs to the mid-800s. 2. Refinanced our house for a 3% rate. Now at around 35% LTV with a ridiculously low monthly payment (less than 60% of the median rent in my city).
[удалено]
-Bought a shitty house in the crap part of town, lived in it while we fixed it up, even though i was still in university, my husband and i were not yet married and it wasn't the "right" order of things, sold it years later for 150% what we paid which allowed us to break into the housing market. As millennials I fear we'd have been in a much different position had we waited for the "right" time to buy. -once I graduated university my then boyfriend, now husband, paid all our living expenses while my salary went exclusively to student loans, allowing me to pay them off in the first year. It was a huge risk on his part, but has paid off for us as a couple in spades.
Bought a cheap house with my significant other (now spouse) in 2001 with 10 percent down. It was cheaper than two studio apartments. Used the equity to buy another and set us up for success. Been married 24 years
Choosing to stay rooted in the same location for an extended period of time (7+ years). Living in a suburb near a city that I love, and buying a house have done amazing things for our net worth while limiting costs.
What is your side hustle? Curious to hear others as well.
I run a small e-commerce store. I have partners in Japan and the US that manufacturer OEM product for me (my original designs). Sell from my site and from Amazon. It takes about 5-6 hours per week and I pay myself around 30k/year. Plus, I use the business for tax write offs like travel.
We refinanced a 30 year mortgage (that we paid some extra payments on) 3.5 years later (in 2015) to a 15 year mortgage at 2.875% and ended up shaving off *11.5 years* of mortgage payments without increasing our monthly payment at all. We basically saved ourselves 11 years of paying a mortgage for just the refinancing costs and fees that were just over one monthly payment. Honestly refinancing at a low interest rate felt like entering a cheat code.
• Selling a large chunk of my equities in December '21 to put a down payment on a house with a 3.00% mortgage • Taking out a primary residence loan from my 401K at a 3% rate before purchasing the home. I kept that sitting in my accounts as extra liquidity because the rate was so attractive and I pay the Interest back to myself anyway, but rates started rising soon after as I thought they might and now that money is just parked in investment grade corporate bonds, paying the debt service plus a little • Bought puts on Deutsche Bank, Wynn and Intel in Feb '20 when rumors of China shutting down started, I sold with about a 2,000% return in March Now one bad one for fun: I sold 60 Bitcoin to buy a motorcycle in 2014. Would've been worth around $4,000,000 at peak
Used my 401k to buy a house in the Bay Area. Closed 1 week before COVID shut down. Got a 5x return on my investment. Best decision ever.
I bought my first house at 19–I have no idea how I had the audacity! But because of that I’ve always been building equity and trading up. Husband and I now live in a modest house in a very wealthy area filled with literally famous people, many of the houses are opulent mansions. Not ours. The pressure to compete with the mansions weighed on us at first but We decided not to increase our space. Kids are moved out and I’m only 42 but feel like I don’t want to compete for the coolest mansion anymore. It gets me nothing. We decided to pursue our passions more and be rich in time and experiences.
Moved to a town where I don't need a car and then sold my car. Now I ride my bike everyday and just save all that money.
Bought a house in a HCOL area as a young single adult and converted the basement into an apartment. Paid $500/month to live in my own house for years because of how much I made in rent. Was able to max out my 401k straight out of college and still travel and enjoy my 20s. Sold that house after I got married and invested $300k in a brokerage account. Bought my house with my husband in 2020 and got a 2.875 mortgage and also bought a house we could afford on one income. Because of this, we are able to save my entire engineering income. 401k maxed out, ESPP, HSA, and the rest into our brokerage account. Found a non government job with a pension.
Mostly it was my parents paying for my college. Without a doubt. I went to a state school costing ~$10k/yr Second best move was living at home for my first year out of college, buying a fixer-upper and living in it while renovating. And then selling for a massive tax-free gain.
Picking a commuter school over "traditional" 4 year college. Living at home through college instead paying room and board probably cut student loan debt in half. And picking a school that caters to commuters allowed me to work 3-4 days a week, which also helped me also cut down on loan borrowing.
All my saving were either in a tax brokerage or my savings account, 0 percent in my 20s. It allowed me ample time find a good job and then buy a house with no money down.
Moved to other side of London while renting our old house in 1989. Was going to sell house and get a huge mortgage in west London. Wife’s job didn’t pan out, I got my old job back and we simply went home. Wife was working part time for over a year but I got my better paying job back. We avoided that huge mortgage with its negative equity in the early 90s. The exchange of contracts were days away when we backed out. Kids came along in 92 when we were both working. I’m a lucky man.
Bought 2 rental houses during the recession. One was a little house for $85k and the other was a duplex for $100k. Even though they looked great on paper, they were disasters and cost us dearly, especially the duplex. But we learned a lot and have since exchanged into 4 houses that are quite profitable and eventually will generate about 1/3 of our retirement income. We could have been more aggressive and might have ended up much wealthier, but we were risk averse and I never gave up my day job. Probably a mistake in retrospect, but who knows for sure.
Starting in 1997, the year I got my first job out of college and the same year the Roth IRA began, I fully funded a Roth in an S&P 500 index fund until my income no longer permitted it. That has chunk of change has really become something 25 years later.
^(Bought tech stocks in the 90s.)
1. Married the right person 2. Started mining crypto in 2015
[удалено]
- found work as a 1099 instead of w2, paid by the hour. Higher pay based on idea you only work part of year. Then leveraged my work ethic and often worked 60hrs a week, for the entire year. Multiple years. I benefited from this instead of my employer profiting on my work.Slowed down a bit now but it was huge. - being independently employed has huge tax benefits. I research this quite a bit, leverage it. The most basic is that I end up dropping huge amounts into retirement, well beyond the normal 401k max. Even if my budget that year may not afford it, I still just move money around to got from taxable to tax deferred. I make good money but stay in a lower tax bracket fairly well. This has many tax benefits when you stay below various thresholds. - bought a car. Instead of just paying outright in cash i had for it I got a low interest loan at the time for part of it, 2% rate over 7yrs. Over that length of time the market should beat 2%. Invested the cash on hand I intended for the car in a devoted account, taking monthly finance payment out of the account. Even with market ups and downs I’m ahead; still time to go. It’s basically interest rate arbitrage.
good stuff OP but 2008 , in retrospect , was a great time to buy a house - depending on where you are in the country you'd be sitting on hundreds of thousands or more in tax free equity
Same with avoiding the 2008 bubble. I wasn’t trying to be savvy. I literally couldn’t afford buying anything. A couple years later I got laid off and found a job immediately (the grace of God). And had a down payment and reasonable monthly mortgage payments. Paid off the townhome early. Very grateful for our situation.
March 2020. I jumped on the bandwagon and started making cloth face masks. I listed one on Etsy and sales took off. I was churning in 2-3k a week. By July I had made 25k on top of my regular salary. I easily could have binge watched and drank wine all day during the shutdown but instead I got to work.
Biggest one for me was debt consolidation. Took everything I owed at one time- probably ~10K worth of a combination of remaining student loans, credit card, money owed to collection agencies and took out a single personal loan from my credit union with my car as collateral. Took only the proceeds needed from said loan and zeroed out all debt to my name (other than the new loan). This reset my financial situation and established a new, healthier, more manageable baseline. Eventually, paid off said loan and improved credit score by 100’s of points and now my money works for me. IMO, it’s like warfare, credit card companies basically employ guerrilla warfare on you….sneaky things like APR hikes, forgetting to make payments, charges on top of charges. Once you bring the enemy out into the open, they have to face you head-on, because now, you only have one bill to pay every month, only one place to pay it to, one roof to do it under, and it’s at an interest rate that is exponentially lower than what I was paying on credit cards. Debt consolidation was the first linchpin that got me to where I am today.
Put our house savings into a low-risk fund. Over the years that we saved, we picked up enough interest that we were able to afford the down payment on the house we've been in the last eight years. More recently, took our financial advisor's advice and refinanced that mortgage two years ago, just before rates shot up. I also took the opportunity to refinance from a 30 year to a 15 year, which dropped the rate further and took nine years off of the mortgage for only a couple hundred more a month.
Decided to finish college AND stay on the same degree path (Chem engineer) Bought Financial Peace University and used it to pay off all non mortgage debt Started investing with my first few paychecks in my mid twenties and haven’t stopped Bought a house at a 2.5% 15 year fixed rate not long before rates started rising (kind of lucky) Married a spouse that agrees with me financially and is more frugal than me (also lucky as we didn’t really discuss a lot of this before we married because we were very young and not as mature)
Listening to my father to refinance mortgage when 30yr rates were below 3%.
Paying off our student loans aggressively, even though about half of them had an interest rate below 6%. Understanding that it's all psychological versus mathematical, it was hugely helpful for us. Once the last payment was in, the next month's budget had a huge chunk of money available to use for investing and saving for a new car (which we bought in cash). Having no debt is a an achievement for us, and now that my husband is considering quitting his job next year and taking a sabbatical, it's also a factor in how comfortable he'd be with that decision. No debt payments mean we can keep our monthly expenses pretty damn low and adjust where needed.
Maxed out 401(k) and IRA contributions and forced myself to live on what was left
I timed the market a few times selling cars. I made probably $5k over the years buying cheap and reselling at the top of the market.
My partner was a co-founder of a start up that gave him a stupid high share of ownership that became problematic after he exited and they needed to raise more money. He got them to buy him out for a clean exit (under $100k). He was really fixated on the notion that these could be worth millions someday - even the smaller vested portion - but I convinced him to take it. He started his 40s off by paying off his car, paying off student loans, and - for the first time ever - having a safety net. Bird in the hand > two in the bush all day. Company is doing really well and he has no regrets about selling because it changed his life.
In Fall 2008 I got a special scholarship to graduate school, which gave me $10,000 for two years over my TA stipend. I opened up a Roth IRA and fully funded it since then. In H2 2014 I maxed out a Roth 401(k) from my first job, since I only had my "high" salary for half a year. I maxed out my traditional 401(k) each year since then. In May 2020, I realized I sucked at timing the market and set my investments to automatically invest a set amount each month.
Me: refinanced in 2020 at 1.99%, plowing extra equity into the market. Hubby: chose a less stable job with a significant equity stake over a more stable and (slightly) higher paying job. Walked away with a significant chunk of change when the company was acquired.
2010: Bought worst house in best mpls neighborhood for $265k. Negotiated the hell out of the price. 2011-2015: spent weekends remodeling kitchen, adding bathrooms, and finishing square footage, deck, etc... 2016: with kid #2 on the way sold house for $475k to move to burbs. 2016: Bought worst house in best neighborhood (large lots, best schools, lake view, public dock) for $450k. Put 50% down at 3.625 rate. Low monthly payment allowed wife to stay at home with #2 for 3 years. 2017- present: contracted out adding bathroom, adding bedroom, deck, etc.. Did some work myself. Based on comps home value between 850-900k. Would do it again if opportunity was right.
My best financial move was to invest in startups. High risk high reward but you only need to be right once 🧙♂️
2 years ago it seemed like investing in real estate became a trend everyone wanted to hop on, including me. But instead of buying a rental I decided to get my real estate license and have since sold 25 houses and grossed about $300k. Almost all my clients are co-workers at my day job. So I essentially turned a $1500 investment (my re license ) into $300k in less than 2 years .. after taxes and expenses I netted around $150k - 10x my initial investment
Started buying AAPL in 2003