Becoming financially independent

[Nobody_Here]

12 minutes ago, jasonjp1016 said:

Also this doesn't mean you retire and do nothing it just means you're more flexible to do what's really important.

What's important to you? Many people find a career to be significant to find their life purpose. There's nothing wrong with retiring at 30, but it's not a good fit for many people as they want to work on something. A lot of people in the FIRE movement had a career and continue earning revenue on something. In my mind, seeing actual retirees, if you're earning money by working, you're not truly retired. Semi-retired, arguably, but not retired.

Example of an actual retiree: My Dad. He's in his early 70s.

Dad will call me during the workday and ask me what day it is since he and Mom woke up at 11 AM and sat in their jammies all day. He knows it's 3 PM on a Tuesday, and I woke up at 5 AM to get to work. He just wanted to remind me that he's retired.

Dad is a retiree.

Edited June 11, 2021 by Nobody_Here

[jasonjp1016]

15 minutes ago, Nobody_Here said:

What's important to you? Many people find a career to be significant to find their life purpose. There's nothing wrong with retiring at 30, but it's not a good fit for many people as they want to work on something. A lot of people in the FIRE movement had a career and continue earning revenue on something. In my mind, seeing actual retirees, if you're earning money by working, you're not truly retired. Semi-retired, arguably, but not retired.

Example of an actual retiree: My Dad. He's in his early 70s.

Dad will call me during the workday and ask me what day it is since he and Mom woke up at 11 AM and sat in their jammies all day. He knows it's 3 PM on a Tuesday, and I woke up at 5 AM to get to work. He just wanted to remind me that he's retired.

Dad is a retiree.

I would agree.  It's not uncommon when people have no purpose after retirement they die sooner then later.  Also it's true the money isn't gonna make you happy.

For a lot of us, it's just the next stage of our lives to take a chance on something else and not worry too much about the outcome.

[jasonjp1016]

6 hours ago, Yarco said:

Not just a high-paying job. You'd need to be in the top 1% pretty much to accomplish this.

Most people don't EARN $5,000 per month. Let alone have $5,000 per month left over after paying their rent/mortgage, food, utilities, etc.

If you lived at home and had $0 expenses, your parents paid for everything, you still need to take tax and employee expenses into account. Realistically you have to earn $80,000 per year and spend $0 for the entire year to save $5,000 per month after tax!

So for someone who actually lives by themselves and pays for stuff, you're looking at requiring a salary (or household income) of like $150,000 to accomplish this. Because at least here (in Canada), your tax rate goes up to like 30%+ once you exceed $60k per year. So from that point onward, you're basically working for 70% of your salary for the rest of the year.

Even more if you live somewhere like California or New York where cost of living is through the roof.

Most people are living week-to-week and have close to $0 in their bank account after each pay once they pay for rent and food.

This is such boomer advice. "Just save $60k a year bro."

A consistent 10% return on your investment is also insanely optimistic. Try like 4 - 5%

Have fun with this strategy over the next couple of years as we enter hyperinflation. If you don't put your money into tangible assets, your fiat money risks becoming worthless and losing all that effort that you put in.

The real "Great Reset" that's coming is rich (excluding the mega-rich) and poor alike being reset back to 0 if our currency hyperinflates:

 

You need higher income if you want to expedite the process for sure.

Also you might be surprised how far your money will go when you stop spending on things you don't need or things that don't make you happy.

As far as hyperinflation, anything is possible I suppose but I wouldn't be so pessimistic.  It happens in poor countries ie, Zimbabwe, Venezuela, etc but the U.S. is still an economic force in the world.  Until that changes I have my doubts you would ever see hyperinflation anytime soon.

[Nobody_Here]

7 minutes ago, jasonjp1016 said:

I would agree.  It's not uncommon when people have no purpose after retirement they die sooner then later.  Also it's true the money isn't gonna make you happy.

For a lot of us, it's just the next stage of our lives to take a chance on something else and not worry too much about the outcome.

Strictly using "not working" as a definition of retirement, I don't want ever fully to retire -- with a couple of exceptions. The closest thing to retirement I'll have is only doing volunteer work or traveling to fill my hours. I'm willing to wait. I enjoy working; it's what that work is and who I'm doing work for is the issue.

[jasonjp1016]

6 hours ago, Hello from Russia said:

Why don't you just become very creative instead of doing this bs. Way less riskier and way more rewarding too

I actually have a really good career this is still moving forward 18 years later, but I want the flexibility if I want to change things in the future.

[jasonjp1016]

4 minutes ago, Nobody_Here said:

Strictly using "not working" as a definition of retirement, I don't want ever fully to retire -- with a couple of exceptions. The closest thing to retirement I'll have is only doing volunteer work or traveling to fill my hours. I'm willing to wait. I enjoy working; it's what that work is and who I'm doing work for is the issue.

Ha, I can understand that.

[Nobody_Here]

5 minutes ago, jasonjp1016 said:

As far as hyperinflation, anything is possible I suppose but I wouldn't be so pessimistic.  It happens in poor countries ie, Zimbabwe, Venezuela, etc but the U.S. is still an economic force in the world.  Until that changes I have my doubts you would ever see hyperinflation anytime soon.

@jasonjp1016, it's already happened in the USA (though admittedly not as bad as Zimbabwe) https://en.wikipedia.org/wiki/1973–1975_recession

[jasonjp1016]

17 minutes ago, Nobody_Here said:

@jasonjp1016, it's already happened in the USA (though admittedly not as bad as Zimbabwe) https://en.wikipedia.org/wiki/1973–1975_recession

I'm aware of that point in time.  If I understand correctly you could also put money in the bank and make some serious interest during those years.

I remember in 2009 all the people losing their mind over potential inflation and nothing really serious happened and it's happening again right now.  The bad thing about right now is you lose money if you save in a bank thru inflation, because of interest rates being so low.

Who knows what's going to happen, I'm not smart enough to know.  I used to get caught up in but try not to worry about anymore.  Anyone who seems too confident about the future is probably full of shit.  

 

[Nobody_Here]

49 minutes ago, jasonjp1016 said:

I'm aware of that point in time.  If I understand correctly you could also put money in the bank and make some serious interest during those years.

I remember in 2009 all the people losing their mind over potential inflation and nothing really serious happened and it's happening again right now.  The bad thing about right now is you lose money if you save in a bank thru inflation, because of interest rates being so low.

Who knows what's going to happen, I'm not smart enough to know.  I used to get caught up in but try not to worry about anymore.  Anyone who seems too confident about the future is probably full of shit.  

Yes, I've met people who invested well during that time and are now worth 8 figures. These weren't well-heeled people but working-class people.

The 1970s were before my time, but it's a decade I'm glad I didn't live through. I mean, there not only was stagflation, but there was also Nixon, the Vietnam War, and disco. Ugh, disco!  

To be clear, I am not concerned about Zimbabwe-level hyperinflation, either. The feds say what is happening these days is nothing to worry about -- at least, not yet. We're going through difficult times, but I think it's better than a year ago.

 

Edited June 11, 2021 by Nobody_Here

[BEWISE]

I agree with you Americans spend millions of dollars on unnecessary material items. To truly get in a position where you can live your life how you please your going to have to work harder than the average person.  And it is a long game so you will suffer and save well maybe not suffer but go without so you can one day in the future enjoy your life. That's one way of doing it but how about getting more creative and start a business but still work and grow the business take advantage of the tax breaks and keep compounding the money in the business use your income to live off. Eventually this will bring you massive amounts of money. I rather invest in myself than the stock market thats just my philisophy. 

 

[jasonjp1016]

12 hours ago, BEWISE said:

I agree with you Americans spend millions of dollars on unnecessary material items. To truly get in a position where you can live your life how you please your going to have to work harder than the average person.  And it is a long game so you will suffer and save well maybe not suffer but go without so you can one day in the future enjoy your life. That's one way of doing it but how about getting more creative and start a business but still work and grow the business take advantage of the tax breaks and keep compounding the money in the business use your income to live off. Eventually this will bring you massive amounts of money. I rather invest in myself than the stock market thats just my philisophy. 

 

Everyone’s situation is unique but I feel being creative could be more fun and less stressful when you’re not worried about paying rent or worrying about whether you’re going to get paid.  Not to mention whether you’ll be successful or not.  How many good athletes never make the majors?  To answer the analogy,  not many.  

You can still live a really nice life while spending less then you make.  It’s not that hard to make money if you have some type of skill.  And this strategy is doable for many Americans whether they are aware of it or not.  Most probably cannot balance their checkbook or keep track of their spending.  To be honest what I’m proposing isn’t exactly a novel idea.  
 

 

 

 

 

 

 

Edited July 1, 2021 by jasonjp1016

[flowboy]

On 10/06/2021 at 7:51 PM, jasonjp1016 said:

$1,000,000 sound like a lot of money and it is but with a decent job it’s actually doable within 10 years for a lot of people.  For example if you invested $5000 a month for 10 years you would be close to $1,000,000 at  a 10% return.  Yes, you will need a high paying job to hit your goals quick.

Sure, good luck getting a super high paying job and keeping your expenses ridiculously low! You're not really going to fit in with your colleagues if you always refuse to go to lunch or dinner with them, and don't wear proper clothes because you're such a cheapskate. You'll be considered a crazy outsider, because clearly you can afford it. That social pressure will wear on you and you will feel isolated and ultimately cave. Also you could technically live in your car / a parked tiny house, but again, you'll have to have the will to withstand crazy social pressures over long periods of time.

Places where those amounts are earned, have very high living and rent expenses, so unless you want a soul-sucking commute of 4-6 hours a day, you'll have to find a remote super high paying job, with a company who pays you equally regardless of where you live. There's not many companies who do this, in fact I only heard of one, so to get a shot at that, you have to be super passionate about it and work really hard to master it.

Which field would you like to go into just for the money sir? Programming? You have to love it a LOT and be super skilled to really make it to the upper ranks and get paid a lot. Law? Same deal. Medicine? You won't even make it through school unless you deeply love it (or are unhealthily pressured by your parents, after which you still will probably not make it unless you love it too).

So then, even if you have that all set, why the hell would you quit something that you love so much?

See this only works if you already found something that closely aligns with your purpose.

 

Also, suppose you make it to be in the position of being able to save thousands a month, it doesn't make sense to keep doing that for a decade in the hopes of retiring on a measly 40K a year (which due to inflation will by then be worth only 30K). If you've tasted the six figure lifestyle, and socialize with people being successful and making six figures, why would you now want to quit your job and go back to 2500 a month, just like you work at Starbucks again? You'd lose your entire social circle and feel like you're poor again. Good luck experiencing that as a win.

 

Have you read UNSCRIPTED or The Millionaire Fastlane? I can highly recommend them.

 

Ultimately I'm not saying that what you're describing is impossible, it's just against human nature in so many ways that you'd have to be a truly exceptional person to stick to that plan.

Also, instead of spending 10 years to save up a million, why not just spend a one year to save up 100K, and then burn that slowly while you start a business? That way you get to be creative and aligned with your purpose a lot sooner, so that you don't burn out or become dead inside doing what you don't love.

That way, you have much more control over your earning potential much sooner, so even if your first attempts don't work out long term, you could have a working business making 10K or even 100K a month at the end of the decade. Whereas in the alternative that you suggested, you'd still be in the starting blocks, and have 10 years of dispassionate work behind you, the fruits of which you didn't even allow yourself to enjoy, so you're not likely to be in a creative high vibrational mood by that point.

Edited July 2, 2021 by flowboy

[jasonjp1016]

@flowboy

I’m living it right now, everything you described cannot be further from the truth.  Stop making assumptions.

Spending less then you make, what a crazy idea!! Geez 

 

[flowboy]

@jasonjp1016  Okay, how much are you saving per month?

[jasonjp1016]

I’m investing 3k to 4k a month depending on what I have going on.

 

[Nahm]

There are literally limitless ways to make money. It’s not actually a do what you want vs make money to be able to retire scenario. That’s more of a ‘first glance’, and the matrix is already perfectly at quota on agents. 

Why not take Leo’s LP course now?

Life’s quick. 

Let the “thinker thinking” concept go. Receive instead. Infinity’s not running out of insight, passion or inspiration anytime soon. All ‘you’ gotta do is utter the words so to speak, ‘move mountain’. 

“When I’m feeling stuck and need a buck I don’t rely on luck because”
JP

[flowboy]

@jasonjp1016 That's awesome. Congratulations.

I guess you are one of the people who can pull off such a high savings rate.

I wish I made that much money right now.

And I apologize for not approaching you with more curiosity and openness.

 

That being said:

If I run 3500 a month through a compound interest calculator, assuming a more realistic 7% interest rate, and take inflation of 3% per year into account... it actually takes 22 years to save up an amount that is worth what today a million is worth.

I think you're doing a great thing and everyone should be good with money in that way, but I'm not convinced that it is wise to put off your life purpose work until you can be financially free that way.

[Jacobsrw]

On 11/06/2021 at 3:51 AM, jasonjp1016 said:

I was watching Leo’s video “Expose yourself to more experience” and there was a lot of talk of developing skills so you’re not a wage slave.

It got me thinking about my journey of financial independence that I’m currently working on right now.  So I was looking thru the forum to see if anyone was talking about financial independence by aggressively saving and investing a.k.a “The F.I.R.E. movement.  To my surprise I didn’t find anything.  

The basic premise is you invest enough money into index funds that you can live off indefinitely.  So for example if you need $40K a year to live off, you would have to save up $1,000,000.  This is called the 4% rule.  Basically you could maintain always having $1,000,000 plus keep up with inflation through the years and never run out of money.

$1,000,000 sound like a lot of money and it is but with a decent job it’s actually doable within 10 years for a lot of people.  For example if you invested $5000 a month for 10 years you would be close to $1,000,000 at  a 10% return.  Yes, you will need a high paying job to hit your goals quick.

Instead of having a fancy house and car you live a more moderate lifestyle, spending well below your means and saving the rest.  I’m sure for a lot of people this seems impossible, especially if you’re living paycheck to paycheck.  But for a lot of Americans, we waste so much money on stupid shit that it really is possible for mandatory work to become more of an option.  For example instead of buying a BMW you could drive a Toyota.

Even if you cannot do this in 10 years, if you consistently save thru your working years, most Americans could retire millionaires by cutting out the fluff and saving more.  Thus reducing mandatory working years.

So why is this relevant to the forum?  Once you don’t need to work you can focus on what’s important to you regardless of outcome.  The need to succeed no longer matters once you no longer need the money.  So now you could write that book, write that song or whatever your passion may be without having to worry about basic survival needs because they’re already met.

I can put in some links and answer any questions that people may have in this post generates any interest.

 

I’ve also noticed minimal conversation in this area. 

This is something I’ve been looking into of recent for multiple reasons myself. However, I wouldn’t be approaching it the exact same way in which the F.I.R.E  movement propagates. I still aim to be frugal, since I have found far more contentment and satisfaction in doing so over the years. Instead, I would be using a combination of part time professional work, real estate investments, freelancing/business and stocks. A mixture of these income streams are likely to help diversify chances in succeeding such an uncommon financial status.

Although, as @Leo Gura stated earlier, your overarching narrative must serve more than merely your own self survival. Hence for example, I aim to use my creative skills in business and freelancing as secondary income sources. There must be a higher aim in contributing to society, for both its functional and spiritual improvement. If you are financially independent and provide no benefit to society you are effectively no more helpful than one dependent on welfare. You’d be helping society more with a typical job. The aim for financial freedom needs a contributional aspect to it, such that society is no further burden on the social structure. Making use of your abilities is one way to ensure this.

Use part of your time to hone a skill and provide this alongside your work. It will both bolster your portfolio, help others and provide you a purpose from which to orient your time living.

 

 

[Logan]

Invest in yourself, not others.