FIRE

Category Archives for FIRE.

Best IRA Accounts: 8 Companies Compared (Self-Directed, Apps, & Roboadvisors)

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A couple weeks ago, I wrote about Acorns, an app I think is a great place to get started with investing (especially for millennials). Talking about investing is dicey. For one, because it’s personal (duh). For that reason, everyone has an opinion on it. And that’s where the confusion starts.

My view is: it doesn’t matter where you begin, so long as you do. You can always switch things around later. To that end, I feel Acorns has the most approachable interface for a beginner “despite” costing $1 a month. And there’s no minimum to start investing.

best ira accounts

The best time to plant a tree was 20 years ago. The second best time is RIGHT THIS SECOND. Start NOW!

That said, it’s an app and doesn’t let you choose your own funds (you pick from their portfolios). Same with StashWealthsimple, and Betterment. Of course, you’ll get the best deal with a self-directed account – but the minimums are dauntingly high for a beginner, with the exception of TD Ameritrade.

I’ll compare these companies for expenses, account and fund minimums, and quirky extras:

I am focusing on IRAs here – although they all have the option to simply be an investment account (which is why I excluded Robinhood – they do NOT have IRAs).

8 Best IRA Accounts Compared

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House Hacking Through… Airbnb? My 1st Month Numbers!

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I’ve written extensively about my adventures hosting on Airbnb. I’ve always leased apartments, then listed them on Airbnb. That formula worked in New York and continues to work in Dallas.

The Airbnb service is intended to rent space in your primary residence. I’d never done that because I didn’t want strangers in my actual home. But last month, I took a weekend and converted my spare bedroom and bathroom into a private guest room and listed it on Airbnb.

airbnb house hacking

My guest bedroom

And so far… wow! The response is incredible. Guests are loving it. And something that surprised me… so am I!

A nice benefit is I’m earning more than if I had a roommate. And I’m even thinking it could get to the point where it could cover my entire mortgage payment – I could live in my own place for basically nothing!

Airbnb house hacking… for real?

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Join Me at FinCon 2017 in Dallas with Limited-Time $249 Passes

I read a lot of personal finance blogs. Increasingly, they mention “travel hacking” AKA what we do on the daily as a way to travel cheap.

And it’s true – I see the parallels between the 2 niches. Especially if you’re using the money you save on traveling and put it in a retirement account. WHICH YOU ALREADY DO, RIGHT? 😉

So when I learned FinCon will be in Dallas this year, I couldn’t think of a single reason not to attend – expect for maybe the cost of the pass.

When I looked, I saw the basic passes were only $249 until February 14th, 2017. Then they’d go up to $469.

Be a Super Early Bird and Come to FinCon for $249

Be a Super Early Bird and Come to FinCon for $249

I whipped out my card faster than you can say “points and miles” and bought a pass without a second thought. And you should come, too!

Why attend FinCon?

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Why I Bought a Car With Credit Cards

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I’m targeting late April/early May to be out of NYC and in Dallas full-time.

For as long as I can remember, I’ve wanted a silver Subaru Forester. Buying a house and moving to Dallas meant I’d need to buy a car sooner or later.

The budget I had in mind was $6,000 for everything. Tax, title, registration, base price of the vehicle, everything.

I knew car prices tend to rise as it gets warmer, so when I found a great deal on the car I wanted in late February, I went ahead and snagged it.

My new cahhh

My new cahhh. I named him Clyde

Oh! And I wanted to pay for it in full. No financing.

Just an in-shape, reliable used car whose only expenses were maintenance, insurance, and gas. Boom.

Buying a car with credit cards

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How I Made an Extra $60K from Airbnb in 2015

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Side hustle of the millennium

Side hustle extraordinaire

I’ve written a lot about my side hustle with Airbnb a lot in the past. So I thought I’d follow up, because side hustles are a big part of my FIRE, and a great way to dig yourself out of debt – or earn more income.

In my Q2 update, I estimated I’d make an extra ~$31K off the endeavor in 2015.

I took some knocks here and there, but doubled my original projection. All told, I earned an extra ~$60K from Airbnb in 2015. And most of it went toward debts. In 2016, I’ll earn less but hopefully knock out my student loans once and for all.

asd

Good vibes

Here’s how I did it.

The numbers

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ABC + FIRE! (In which life is all acronyms.)

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I’ve been looking forward to writing this post for a few months by now. Now here it is!

Yesterday, I made the final payment on my credit cards. Now, I don’t owe a cent of credit card debt!

As you guys know, I charged those puppies up to:

There was a point, a real and scary one, where I felt I’d certainly overleveraged myself.

I wrote about the feeling in Smart Debt: Is carrying a balance ever a good idea?

Side hustle of the millennium

Side hustle of the millennium

And I definitely felt I’d nearly crossed the line into plain ol’ dumb debt.

Digging out of credit card debt is by far one of the most psychologically strenuous exercises I’ve faced. And that moment where I saw the interest get charged felt so wrong, my stomach turned. But I knew I could shoulder a couple of months of interest to make it all back, plus more.

Still, it sucked.

And today is the official turning point where I go full-force into FIRE.

What is FIRE?

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In Praise of Humble Beginnings

I was reading an article called “How to invest even if you’re treading water financially” via Get Rich Slowly and a certain part jumped out at me (bolding and links mine):

“Don’t despise small beginnings.
The first steps in any endeavor are humble. Gustave Eiffel, famous today for his tower in Paris and the Statue of Liberty, started as an unpaid assistant in a foundry. Setting aside $10 a month might feel meaningless: “What difference can that ever make?” That’s wrong. It makes a difference in many ways:

Start somewhere

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Getting FIREd Up

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This is an out-of-control flaming emergency, according to Mr. Money Mustache

I have an out-of-control flaming emergency, according to Mr. Money Mustache

I recently wrote about life changes that I thought might happen… soon.

Well, even though Mercury was retrograde, nothing stopped chugging along. In fact, everything got a swift kick in the butt. And now life is different.

I’ve been getting used to the new rhythm. It feels so different. And it’s given me a chance to review where I’m at and how I want to move forward.

What is FIRE?

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The 10% Plan: Save 10 Percent of Everything You Make

10% of everything!

10% of everything!

I’ve started a new savings routine that is blowing me out of the water. That sounds weird to say, but it’s true. It’s an idea I directly lifted from a book called “The Automatic Millionaire” by David Bach.

The crux of the idea is that you put 10% of everything you make into a savings or retirement account. Everything.

If someone hands you a dollar, you put a dime into savings. You make $1,000, well, $100 goes into your savings account. 10%, all the time. From the savings account, you can distribute the money in a few ways:

  • Leave it in there to serve as a cushion (it’s a good idea to have 3-6 months of expenses saved)
  • Transfer to IRA
  • Save up for a goal (down payment on a car/house, repairs/renovations, etc)
  • Pay down student loans or other debts
  • Simply save it for peace of mind

After I read “The Automatic Millionaire” I started putting this into practice. It’s been about 2 months by now, and I’m kind of amazed at how much I’ve already been able to save – automatically.

It also signaled a shift in my mindset.

Why 10%?

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The Climb to Pay Off Debt and Be Financially Independent

I sent a payment today to my student loan company for $100. It felt like throwing a glass of water on a burning building. But that’s the exactly the attitude I’m trying to break.

Yes, right now, $100 toward my $47,584.54 student loan debt felt like taking a drop of water out of the ocean. But it’s $100 that’s out of the running for all that compound interest.

I’m trying to balance wanting to invest for the future, travel like a mofo, and get rid of all this damn debt. My student loan has an APR that will make you wince, so get ready for it: 6.75%. Any investment I could make may or may not have that type of return. But putting $100 in an investment account isn’t going to do me any good until I can wrangle the cost of my previous education.

It’s so weird that I could theoretically pay off this loan for the rest of my life. And I guess some people are OK with that. But I’m not. I want to get this debt off my plate ASAP. Even if I pay off $1000 a month, it’ll take 48 months, AKA 4 years – and that’s assuming no interest! It’s simply got to happen sooner than that.

I’m reading this book, Walden on Wheels, about Ken Ilgunas’ journey with this exact same thing. It’s such an inspiration. I highly encourage you to check it out.

I’m about to get real aggressive with this real fast. I know I’m not the first person to grapple with this crippled system, but until I get this debt outta here, I can’t feasibly invest for my future or buy a house. Once I get into the principal a bit, maybe I can balance my goals a little better. But not now. This is my first priority.

I listed some stuff on eBay, I’m selling my books, and I work part-time for a courier service which nets me about $1000 a month, in addition to my salary of $50,000 a year. But now that I’m in super payoff mode, I want to find a way to generate even more money. I’ve been wanting to get my CFP certification, which costs only about $5000. But that’s now five months of loan payments… and thinking in terms of loan payments is the mindset I have to be in for the next couple of years.

I can’t stop traveling. That’s why I have so many cards that generate points and let me go places for free. In fact, I’m off to Alaska next week (on American in economy, but except thoughts/trip report nonetheless!). There is marginal cost, even for free travel, but I have to seek new experiences or I’ll wither away inside.

I want to chronicle, as so many others have done, my climb up the mountain of raging student loan debt. This blog will hold me accountable, motivate me, and hopefully allow me to learn some nuggets of wisdom that I can pass along.

I’ll post regular “Financial Snapshots.” In a decade, I want my net worth to go from $-50,000 to $+500,000. Let’s do this.

Thanks for reading!

Financial Snapshot 8/10/13

Screen shot 2013-08-10 at 9.04.48 PM

 

 

I use mint.com to keep track of my credit card accounts, IRAs, and student loans. My student loans are by far the bulk of my debt – about $50,000.

I currently have IRAs with two companies, Fidelity and USAA, and a brokerage account with Fidelity (the one my Fidelity Investment Rewards card plugs into). There’s about $4,000 among them.

My immediate goals are to pay down student loan debt, save up for a down payment on a house, and put the rest into an IRA until I max it out. This will definitely be a “slow and steady wins the race” kind of proposition.

My current salary is about $60,000 ($50,000 base + yearly bonus + reimbursements for healthcare).

My first Financial Snapshot. Really putting it all out there. Here goes nothin’…