Tag: how to retire early
Our $3.7 Million Fat FIRE Strategy | New Investment Strategy to Retire Early by 45
Jason 0 Comments Career after Retirement Retire Wealthy
In september 2021, i published a video about our fat fire strategy in the amount of 2 8 million dollars and that video is still by far the best performing video, and it was like the 15th video i’ve ever made for this channel with less than 150 subscribers, our fat fire strategy, became the core of my youtube channel here at fireside chat and that video had a complete breakdown of our fire expenses like housing, health care and discretionary like travel, entertainment and fine dining. A lot has changed since that video was published in september 2021. We’re seeing a high inflation rate, like we’ve, never seen before, unless you’re a baby boomer who experienced high inflation in the 70s, the stock market, like the s p 500. Dow and nasdaq is down 20 25 or even 30 since the beginning of 2022. I also had a significant life event and i recently got married to my beautiful wife, whom i dated for over four years, and we’re still fine tuning our fat fire strategy to make sure that we can retire early together for uh by age 45. After doing several fat fire calculations based on our income, expenses, inflation and investment, we’re going to have to change our fat fire number from 2 8 million dollars to about 3 7 million dollars, and this is the most conservative conservative fat fire number. We came up with and we would also like to live in several locations and not just stay in one place during our retirement, which will increase our baseline expenses. If you’re brand new to my channel, my name is sai and welcome. So in this video. I’m gon na go over how we’re investing to achieve fat fire of 3 7 million dollars and how we’re, prioritizing our savings and investment based on our future expenses, so we can retire early from the 95 workforce. This is a juicy video and i hope you get a lot out of it. Also don’t forget to check out my grammarly affiliate link in the description below so the first thing we had to figure out was our fat fire number. Now we have several fire strategies like lean fire, which is for people who want to live a minimalistic lifestyle coast fire, which is for people who want to coast into normal retirement and barista fire, which is for people who want to take a part time job to Pay for health care expenses, while using their nest, eggs to pay for their retirement lifestyle, be sure to check out those videos, and i will put those links in the description below but fat. Fire is the lifestyle we want where we can truly enjoy our lives by traveling, the world and living in several locations. We don’t know what those countries are just yet, but we plan to travel overseas at least once or twice a year to do some research. So the first thing we have to do was to figure out our annual expenses. Originally, we would have been happy with just 100 000 a year in passive income using the 4 withdrawal rate. So what that means is that, with a 2 5 million dollar investment portfolio, we would withdraw 4 of that portfolio every year in the amount of one hundred thousand dollars. We would also have uh three hundred thousand dollars or ten percent of our total portfolio in cash or cds on the sideline. In case we experience a bear market, like we’re, seeing now in 2022, so we wouldn’t have to sell our stocks at a loss from our investment portfolio. Our baseline expenses will increase based on inflation, but that doesn’t mean every single expense. In our household is going to dramatically increase our mortgage payments, for example, will remain the same because they would be at a 30 year fixed mortgage rate, and another possibility is that we pay off our home completely if the mortgage rate stays above six percent for the Next 10 years, which would suck, in my opinion and, however, paying six six percent interest for our primary residence, wouldn’t be worth it anymore. If the stock market performs seven percent on average annually, even if the market performs 10 annually, the margin isn’t wide enough for us to justify to keep making mortgage payments. Then let me know in the comment section down below if you have a different, take or different approach on our strategy, i would estimate our baseline expenses between housing utilities, transportation, groceries and healthcare expenses to be anywhere around 50 and 75 000 a year based on a Three percent annual inflation rate and the only wild card we have is healthcare, and i can only imagine our healthcare expenses to continue to increase over the coming years and especially if we decide to retire in the us. We’re also going to have several properties in different states or different countries, and that will increase our basic housing expenses with our fat fire number at 3, 7 million dollars, the 4 withdrawal rate will be 148 000 a year. The 3 withdrawal rate will be around 111 000 a year if we end up not spending too much money due to a bear market or other short term catalysts. After the baseline expenses, we could spend anywhere between 36 and 61 000 a year on travel and entertainment. Keep in mind that we’re going to recalculate our fire number every year, based on our future expenses and inflation, make sure to watch the entire video, and i will show you our passive income sources and the investment strategy by the way. If you need help creating your own fire strategy, you can schedule a free one on one 20 minute financial coaching session by visiting fischer com, coaching for our fat fire strategy. We’re going to prioritize our savings and investments in this order. Cash for annual expenses like taxes – and we want to have at least 10 to 15 percent of our net worth in liquid assets. So if our net worth is a million dollars, then we want to have at least one hundred thousand dollars in cash or cash equivalent assets. The second priority is our retirement accounts like tsp pensions, iras and hsas, and i will talk more about that in a little bit. The third priority is our non retirement assets like the taxable brokerage accounts for our early retirement between the ages of 45 and 60. The fourth priority is our travel fund, entertainment and our daughter’s college fund. I also have a fire checklist that we follow and you can download for free by visiting fightcech com contact. We have our emergency fund in a completely separate savings, account that we do not touch unless it’s for emergency medical expenses or anything else that’s unexpected. Our rule is that we only use it if it’s an unexpected emergency, and i strongly encourage you to check out this video i made about the emergency fund and i will link that video in the description below just keep in mind that the differences between A rainy day fund and an emergency fund is that in a rainy day fund you need to cash right away for a blown tire, and an emergency fund is to cover your living expenses. While you’re looking for a new source of income and since we’re debt free and we have a fully funded emergency fund, we maxed out our tsp iras and hsas between my wife and i we contribute up to 50 000 a year, including our Employer matches and she has the nevada state pension fund, which is a lot different than the traditional retirement accounts like 401k or tsp. She contributes 15 of her income and her employer makes a 100 match to her personal contribution, and i can contribute up to 20 500 and another eight hundred dollars from my employer match to be exact. We contribute a total of forty, nine thousand six hundred and thirty one dollars, and we expect the contribution limits to increase over the years. We also prioritize our roth iras and since we exceed our roth ira income limits, we have to do what’s called a backdoor roth ira, and i will link that video in the description below we each contribute six thousand dollars to our traditional iras as non Deductible contributions and then we convert the six thousand dollars to our roth iras. That’s a total of twelve thousand dollars between the two of us and just keep in mind that the rules for roth iras are different like contributions, conversions and earnings. And i strongly encourage you to watch the video about the five year conversion ladder, so you have a better understanding of the roth ira conversion rules. We don’t plan to touch our roth iras until we’re in our 60s or 70s, because we want our roth ira race to grow tax free as much as possible and as long as possible. We expect to have about four million dollars total in our roth ira race. By the time we turn 60 Hsa is another investment account that we own through our employers, and i understand that not everyone is eligible to contribute to the hsa, especially if you have tricare hsa stands for health savings account and it’s completely different from the Healthcare fsa, which stands for flexible savings account and the hsa comes with triple tax advantages, so we can contribute to it in pre tax dollars, which lowers our taxable income. We can invest what we put in the hsa into an index fund like the s p, 500 index fund and the interest and earnings will grow tax free. We can also withdraw from our hsa tax free as long as as we use it for medical expenses and we keep every receipt from medical, dental and vision expenses we paid in cash, so we can get reimbursed for those expenses during our early retirement. When we turn 65, we can withdraw from our hsa for non medical expenses and only pay federal income taxes for the withdrawals. Since we file our taxes jointly, we contribute up to 7 300 a year for our family hsa. If we don’t make any withdrawals during our early retirement, we should have about two hundred and fifty thousand dollars by the time we turn 50 years old by age 65. We should have 1 2 million dollars in our hsa, with a 10 average annual rate of return between tsp state pension funds, uh roth iras and hsas. We’re contributing a total of 68 931 dollars just for the year 2022 and we’re expecting the contribution limits to increase, at least for the next few years, due to high inflation hsa’s contribution limits for 2023 is already increased from seventy. Three hundred dollars to seventy seven hundred dollars. I expect the contribution limits for iras to increase from six thousand dollars to possibly seven thousand dollars and 401k or tsp from 20 500 to possibly 21 500. We also contribute to our non retirement. Investment accounts, like the taxable brokerage accounts. We have one brokerage account that only invests in aggressive and high growth stocks. We have another brokerage account that only invests in income based stocks that pay quarterly dividends to their shareholders. We’re hoping to consistently invest 50 000. A year into these taxable brokerage accounts so that by the time we retire early in 2032, we would have at least one million dollars in our dividend: stock portfolio and another million dollars in our growth stock portfolio. If we maintain a four percent annual dividend yield in one of those accounts, we should make forty thousand dollars a year just in dividend income and keep in mind that the tax rate for dividends is also different from the federal income tax. We expect to have minimal earned income, and that puts us in that zero percent capital gains tax category based on my calculation, and if we make less than eighty four thousand dollars a year in earned income, our dividend tax rate should remain zero percent. As long as congress, doesn’t mess up mess up our tax rates, our goal is to minimize our taxes as much as possible during our early retirement. So now let’s go back to my fire checklist for a minute and we’re already saving over 60 of our income towards our retirement and non retirement accounts and whatever we have remaining usually goes to our travel and entertainment fund. And we call that our sinking funds – we’re, currently saving anywhere between 10 and 15 000 a year into our travel fund, and if we decide to travel more or our income continues to increase, then we’ll bump it up to our uh, maybe 20, To 30 000 a year, we’re also contributing to our daughter,’s. 529. It it’s projected to cover a significant amount of expenses for college tuitions. We’re not too worried about her college tuition because i already transferred my post 911 gi bill over to her and several years ago, and even if my daughter ends up not using the 529 college fund, i can change the beneficiary to my future grandkids or Even to myself, if i want to by the way you can get our free fire resources, including these spreadsheets, by visiting fischer com contact, you can also check out the fight such as shop, and i have all of my stuff on my bookshelf. At firesidechat com shopping. Now let’s talk about our income sources during our early retirement, if 2022 taught us anything and that is to diversify our income sources, so we don’t have all of our money in the stock market with 3 7 million dollars our net worth should Be anywhere between six and nine million dollars, one of our main sources of income is our dividend, and i’m gon na be very conservative here and say we’ll make anywhere between 40 and 50 000 a year in dividend income just from our taxable Brokerage account at the same time, we’re going to convert what we have in our traditional retirement accounts to our roth iras and that will trigger a taxable event right. However, since our earned income is zero because we will be retired, every 50 000 we convert from our traditional retirement accounts will be taxed at 12, as opposed to 32 percent based on our current income. So for every conversion we make from a traditional to a roth account there’s a five year waiting period before uh before we can withdraw that conversion, completely tax free from our roth ira. So what we’ll need to do is have extra cash to cover expenses during the first five years of conversion to keep our taxes at the lowest rate possible. So when we convert fifty thousand dollars in the year 2032, we will have to wait until january. First, 1st 2037 to make the 50 000 withdrawal completely tax, free and penalty free. We just need to make sure that we have enough cash or other income sources to cover between 2032 and 2037. This is a common fire strategy that early retirees use. So i strongly encourage you to check out this video about the 5 year conversion ladder. We prioritize our retirement accounts over our non retirement accounts because our retirement accounts, like the tsp pension fund, iras and hsas, are like a full back plan. If we decide not to retire early and we want to grow our tax advantage, retirement accounts as much as possible, so we can retire comfortably when we turn 60 years old, completely. Tax free and our primary focus is building our stock market and real estate portfolios. To make sure the money can last during our early retirement between the ages of 45 and 60, consistency and patience are the keys to our financial success. We’ll always invest up to the maximum contribution limits to our tsp ira and hsa and will save at least half of our income to both retirement and non retirement accounts. Whenever we experience a bear market like in 2022, we’re excited to invest in these stocks with a discount and it’s like going to a black friday sale at best buy and what’s different about this bear market is that we’re Dealing with high inflation as well, we increased our fire number because the prices we’re seeing now should be the prices we see five years from now, and i think a lot of these expenses are already priced in and we’re not going to see Much of a decline in the future, but instead there will be a slowdown in the inflation rate in 2023 and possibly into 2024. This is why budgeting is so important for everyone who is pursuing financial independence and retiring early from the 9 to 5 workforce, and if you want to know more about how to invest for your future, be sure to check out these two videos so that’s It i appreciate you watching my video don’t forget to subscribe and i hope to see you in the next video have a good one Music. You
The 4% Rule for Retirement (FIRE)
Jason 0 Comments Retirement Planning
If you have spent any time researching retirement planning online, you have heard of the 4% rule. If you haven’t heard of it, the 4% rule suggests that if you spend 4% of your assets in your initial year of retirement, and then adjust for inflation each year going forward, you will be unlikely to run out of money. To put some numbers to it, if you wanted to retire and spend $40,000 per year, adjusted for inflation, from your portfolio, you would need to retire with one million dollars to adhere to the four percent rule. This rule is alternatively described as the requirement to have 25 years worth of spending in your portfolio to afford retirement. 1/25 equals 4% – it’s the same rule. While it is simple and elegant, the 4% rule is probably not the best way to plan for retirement, especially if you plan on retiring early. I’m Ben Felix, Associate Portfolio Manager at PWL Capital. In this episode of Common Sense Investing, I’m going to tell you why the 4% rule is not a rule to live by.
The 4% rule originated in William Bengen’s October 1994 study, published in the Journal of Financial Planning. Bengen was a financial planner. He wanted to find a realistic safe withdrawal rate to recommend to his retired clients. Bengan’s breakthrough in determining a safe withdrawal rate came from modelling spending over 30-year periods in US market history rather than the common practice of simply using average historical returns. Using data for a hypothetical portfolio consisting of 50% S&P 500 index and 50% intermediate-term US government bonds he looked at rolling 30-year periods starting in 1926, ending with 1992. So, 1926 – 1955, followed by 1927 – 1956 etc., ending with 1963 – 1992. The maximum safe withdrawal rate in the worst 30-year period ended up being just over 4%. From this simple but innovative analysis, the 4% rule was born. More recently Bengen has adjusted his spending rule to 4.5% based on the inclusion of small cap stocks in the hypothetical historical portfolio.
While the 4% (and the 4.5% rule) may have basis in historical US data, there are substantial problems with these rules in general, and specifically in the case of a retirement period longer than 30 years. In his 2017 book How Much Can I Spend in Retirement, Wade Pfau, Ph.D, CFA, looked at 30-year safe withdrawal rates in both US and non-US markets using the Dimson-Marsh-Staunton Global Returns Dataset, and assuming a portfolio of 50% stocks and 50% bills. He found that the US at 3.9%, Canada at 4.0%, New Zealand at 3.8%, and Denmark at 3.7% were the only countries in the dataset that would have historically supported something close to the 4% rule. The aggregate global portfolio of stocks and bills had a much lower 30-year safe withdrawal rate of 3.5%. Considering returns other that US historical returns is important, but, in my opinion, one of the most important assumptions to be aware of in the 4% rule is the 30-year retirement period used by Bengen. People are living longer, and many of the bloggers citing the 4% rule are focused on FIRE, financial independence retire early.
In Bengen’s study the 4% rule with a 50% stock 50% bond portfolio was shown to have a 0% chance of failure over 30-year historical periods in the US. That chance of failure increases to around 15% over 40-year periods, and closer to 30% over 50-year periods. FIRE likely means a retirement period longer than 30 years. Modelling longer time periods using historical sampling becomes problematic because we have data for a limited number of historical 50-year periods.
One way to address this issue is with Monte Carlo simulation. Monte Carlo is a technique where an unlimited number of sample data sets can be simulated to model uncertainty without relying on historical periods. Even with Monte Carlo simulation, there is an obvious risk to using historical data to build expectations about the future. The world today is different than it was in the past. Interest rates are low, and stock prices are high. While it may be reasonable to expect relative outcomes to persist, such as stocks outperforming bonds, small stocks outperforming large stocks, and value stocks outperforming growth stocks, the magnitude of future returns are unknown and unknowable. To address this for financial planning, PWL Capital uses a combination of equilibrium cost of capital and current market conditions to build an estimate for expected future returns for use in financial planning. This process is outlined in the 2016 paper Great Expectations.
Using the December 2017 PWL Capital expected returns for a 50% stock 50% bond portfolio we are able to model the safe withdrawal rate for varying durations of retirement using Monte Carlo simulation. We will assume that a 95% success rate over 1,000 trials is sufficient to be called a safe withdrawal rate. For a 30-year retirement period, our Monte Carlo simulation gives us a 3.5% safe withdrawal rate. Pretty close to the original 4% rule, and spot on with Wade Pfau’s global revision of Bengen’s analysis. Now let’s say a 40-year old wants to retire today and assume life until age 95. That’s a 55-year retirement period. The safe withdrawal rate? 2.2%. I think that this is such an important message. The 4% rule falls apart over longer retirement periods. So far we have talked about spending a consistent inflation adjusted amount each year in retirement. One way to increase the amount that you can spend overall is allowing for variable spending. In general this means spending more when markets are good, and spending less when markets are bad. The result is more spending overall with a lower probability of running out of money. The catch is that you have to live with a variable income or have the ability to generate additional income from, say, working, to fill in the gaps when markets are not doing well.
We also need to talk about fees. Fees reduce returns. Fees may be negligible if you are using low-cost ETFs, but they become extremely important if you are using high-fee mutual funds, or if you are paying for financial advice. The safe withdrawal rate in the worst 30-year period in the US drops to 3.56% with a 1% fee, making the 4% rule the more like the 3.5% rule after a 1% fee.
Adding a 1% fee to the Monte Carlo simulation reduces the safe withdrawal rates by around 0.50% on average. In both cases this is a meaningful reduction in spending. Of course, fees need to be considered alongside the value being received in exchange for the fee. This value should be heavily tied to behavioural coaching and financial decision making. There have been two well-known attempts to quantify the value of financial advice, one by Vanguard and one by Morningstar. Vanguard estimated that between building a customized investment plan, minimizing risks and tax impacts, and behavioural coaching, good financial advice can add an average of 3% per year to returns. Morningstar looked at withdrawal strategies, asset allocation, tax efficiency, liability relative optimization, annuity allocation, and timing of social security (CPP in Canada), to arrive at a value-add of 2.34% per year.
PWL Capital’s Raymond Kerzerho has also written on this topic, finding an estimated value-add of just over 3% per year. Based on these analyses, one could argue that paying 1% for good financial advice could even increase your safe withdrawal rate. I would not go that far, but the point is that while fees are a consideration, they may be worthwhile in exchange for good advice.
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Read MoreHow To Retire Early Through Property Investing | A Retirement Planning Pension Strategy
Jason 0 Comments Retirement Planning
Most people will likely consider it impossible when they come across this video’s thumbnail. However, I want to demonstrate how it is feasible to retire in two years by investing in a specific type of property, simply by taking action. My name is Tony Law from Your First Four Houses, and I coach individuals on how to construct a small property portfolio that produces a substantial income stream, enabling them to become financially independent and leave their regular jobs if they choose to. For 21 years, I worked in a kitchen business where I traded my time for money, but in under two years, I managed to substitute that kitchen income with a passive or relatively passive rental income. In this video, I’ll demonstrate how you can accomplish the same.
Now, let’s assume that you do not require 10,000 pounds per month to retire and live comfortably. The average household income in the UK appears to be between 28,000 to 35,000 pounds per year, depending on where you live, although living comfortably on that amount might be challenging for some. To keep things simple, let’s round it up to 42,000 pounds per year, which equates to 3,500 pounds per month in passive rental income. While some may think that figure is low, I believe most people could retire and live comfortably on that amount if they had no other expenses. So, we now have a clear objective to work towards.
When looking to earn a passive income of 3,500 pounds per month, the first step is to determine how many rental units are needed to achieve this goal. The number of properties required will depend on the deals and strategies employed, but for the purposes of this exercise, let’s assume an average cash flow of 500 pounds per month after all expenses. With this in mind, seven properties would be needed to generate 3,500 pounds per month. While this may seem daunting, it is achievable within a two-year timeframe with the right approach and effort.
Achieving a passive income of 3,500 pounds per month may seem like an impossible feat, but let me show you how it can be done. As a property investment coach, my goal is to help people build a small property portfolio that generates a great income, allowing them to achieve financial freedom.
To start, we need to break down the numbers. 3,500 pounds per month can be achieved with a portfolio of seven properties, each generating an average cashflow of 500 pounds per month. While this may seem daunting, I believe it can be accomplished in just two years with a ton of effort and action.
In the first year, you may acquire two to three properties, with the remaining four to five acquired in the second year as your experience and confidence grow. Although it won’t be easy, with hard work and dedication, you can achieve this target.
If you’re interested in learning about the 15 tasks you can do in the next seven days to help achieve your goals, check out my video. Property investing may require hard work, but the rewards are worth it. In just a couple of years, you can replace your income entirely.
To assist you on your journey, I have updated my 50 point checklist for buying investment properties. If you’re interested in receiving a copy, click the link provided or see the description box below. My goal is to help you achieve financial freedom through property investment.
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Read MoreHow To Retire Early? (Young And Rich: Is It Possible?)
Jason 0 Comments Retire Wealthy
Hey, what’s up? John Sonmez here from simpleprogrammer.com. Tired of pushy recruiters sending you LinkedIn requests for jobs you have no interest in? Tired of blasting out resumes into the dark? If so, you should check out Hired.com. Hired.com flips job searching on its head by having top employers like Facebook come to you after you fill out one simple application. You also get your own job coach to help you on your next job search. If you haven’t checked it out, I highly recommend you at least fill out the application. Just go to Hired.com/simpleprogrammer. When you get hired with Hired, you’ll get double the normal sign-on bonus for using that link. Today we’re going to be talking about real estate.
Yes. I have done some videos on real estate. Some of you are like, “What the heck? Why is this guy talking about real estate?” Well, I’ve done fairly well in the real estate realm. If you’re interested, you can always check out my playlist on real estate investment and investment in general. I’m not going to go into all the details here, but occasionally I like to answer a few real estate questions on this channel. I got one here from Jonathan and he says, “I’m 21 and set a goal that I want to retire by 40 to 45.” Cool. “With 20K of passive rental property income.” Man, that’s awesome. I like that. I love that goal. That’s a good goal. “Currently saving money to buy my first property and hopefully, when I get a web development job I can speed up the process. My question is how do I plan for this goal?” This is good.
So, 21, Jonathan is 21 and he’s thinking this way and he’s got this plan by 40 to 45 to make 20K of passive income from rental properties. I love this. This is great. “Thanks for everything you do and have a beautiful day.” I am having a beautiful day. Thank you, Jonathan. “P.S. I was thinking of buying a duplex and live in one and I rent out the other one so basically the tenant pays my mortgage.” So, okay, there’s a lot of ways to approach this. I think Jonathan has got his head screwed on right. Well, I’ll start with the last, the P.S. of renting out a duplex and living in one side. I think that’s a great idea. This is a fantastic thing. More people should do this. A lot of you young people out there that are thinking about renting or buying a house, consider buying a duplex and renting out one side and if you find the right deal which—it’s out there, you could actually have the renters pay your rent.
You see what I’m saying? You could actually live for totally free by having a duplex and renting out one side. I’m not going to say it’s going to be super easy. I’m not going to say that those deals are everywhere. It depends on where you’re at. You’re not going to find that deal in California or New York, San Francisco, not going to happen, but if you’re in the Midwest you might be able to find that deal. I’ve seen it before. I think that’s a great idea, but let’s talk about the plan. 21, you want to retire by 40 to 45. You want to get 20K of passive real estate income. It’s not going to be easy, but it’s certainly doable. What you need to do is you need to calculate backwards where you need to be and have a real solid plan for this.
I can give you a general outline, but I haven’t run the numbers so I can’t tell you exactly. There are going to be some factors in here, but you actually need to take a spreadsheet and actually need to calculate this and figure this out. It’s going to be fairly complex, but you don’t have to be super detailed. You can kind of ballpark this, but you do need a spreadsheet. You can get some rough answers here, but calculate this out, 20K of passive income from real estate. Let’s say 45. What does your gross need to be? You’re going to have expenses, you’re going to have rents, I mean you’re going to have property management, you’re going to have a bunch of things here. That can give you an idea of what kind of wrench you need to be pulling in. It’s not going to be a 20K wrench, you’re not just getting 20K. It might be like 30 or 40K a month of rents. In order to get 40K a month of rent how many properties do you need and how much will those properties cost? How can you divide that over time and put inflation into the equation a little bit here over that period of time? Work backwards and make a spreadsheet and run some scenarios.
This is going to take time and some planning. Like I said, you can rough ballpark it. If I were just going to give you what I think would probably work for you, it also depends on how big your budget is. How much money are you investing every year? How much money do you have to invest every year. If you can put 10K down onto a rental property every year that’s different than, “Hey, I’ve got 50K to invest in real estate every year.” That’s different. Or 100K. Those are all different scenarios. What you’re planning based on your current scenario might—there may not be—there might be this gap and you might be like, “Well, how do I get there?” It might not be apparent.
You might have to do some other things. You might need to make more money in your job or start a side business in order to fuel that. I had to do that to reach some of my real estate goals. Think about that and calculate that out. I’ll give you kind of a rough timeline, a rough plan that I would have if I were you which would be something like—and this was the plan I initially developed when I was doing this which would be to buy one property every year, regardless. The nice thing I like about this plan is that it’s scalable.
The size of the property depends—is dependent upon how much money that you have in that year. When I first started in real estate investment when I was close to your age, I think I bought my first house at 19, but I really started doing investments around 21 and started this plan of buying one house per year. I think the first house that I bought I was able to put $10,000 down. It was like a $100,000 house or $120,000 house. The next year it was probably about the same and then probably like the third or fourth year I had more money. I was able to put $20,000 or $30,000 down. I got to the point where I was buying properties and I was putting about $20, $30, $40,000 down every year on a property when I buy it. Some of that was because of the real estate that I was already making me money. Some of it was because I was making more money in my job and I had businesses and side things going on which helped me to do that. That’s the kind of plan that I would—it’s not going to happen magically. I think that’s the key thing. You actually have to have a solid plan for this and you can run these numbers and calculate this out.
There’s actually a really good book that I recommend called The Millionaire Real Estate Investor. I think that’s by Garry Keller, the founder of Keller Williams if I recall correctly. I don’t recommend very many real estate books, simply because a lot of them are crap. The reason why I’m really going to recommend that book to you is because it has these charts that show you—it gives you a realistic expectation over 20 years what the value of a property is likely to be, how much money you’re likely to make from it, cashflow and all that. Again, it’s as complex equation. You’re not going to be able to nail this down perfectly, but at least if you run the numbers and you do the best job that you can, you can have a ballpark idea and you can always adjust the plan. You’ve got to have—you’ve got to know where you are and where you need to go in order to reach these goals. I’ll also recommend for you—I have a course that I created called Simple Real Estate Investing for Software Developers.
You can check that out here. If you buy that course, obviously it has a money back guarantee on it, but that’s going to help you to give you the basics of everything I know about investing. Just to give you a background, I have about 26 rental properties. They are all paid off. I started investing when I was 19. I kind of know what I’m talking about here. I don’t give a lot of bull shit advice about this. I give you exactly—practical advice on how to get started and how to do this.
The reason why I created the course, even though it might not seem like it goes along with a lot of my other content, it was just simply because I was tired of so many people giving BS real estate advice and doing all these kind of scamming, no money down, speculative moves that just doesn’t make sense. You need some kind of practical advice so that’s what I put together there. Go check that out. This is good. I think you’ve got a good plan here. You just need to develop the plan further and it’s going to be very dependent on your individual factors and—I think you have information though to say, “Okay, can you do this in 45—by the time you’re 45?” absolutely! I believe that you can. It’s not going to be easy, it’s going to be hard to do. 20K is a pretty big number but it’s certainly possible, but you’re going to have to start moving now, which it seems like you’re going to do, and you have to have a plan and it’s going to take a lot of work and a lot of effort and you got to find good deals in order to be able to do this in that time frame.
All right, I hope that is helpful to you. If you have a question for me, you can email me at [email protected]. Don’t forget to click the subscribe button if you haven’t already. Click that Subscribe. Click the bell to make sure you don’t miss any videos especially if you like the real estate stuff because, hey, those videos might not show up and then you’d miss it and then you wouldn’t find out the secret to life and how to make millions of dollars. All right, I’ll talk to you next time. Take care .
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Read MoreHow we Retired at 40..💰7 tips to succeed for Early Retirement💰
Jason 0 Comments Retire Wealthy
Hey guys retired at 40 I’m going on a little road trip today just me and Murph and last week I reached a milestone on my channel and I hit a million views total and 10,000 subscribers in the same week since I’ve been getting requests for quite a long time about how I retired at 40 and I’m on a long road trip right now I figured what better time to share the story so without further ado here’s the retired at 40 story so before I get started I want to say that this is not in any way a brag story in fact I’m definitely not a showy type guy I enjoy very simple things in life and money to me is more of just a vehicle to be able to retire young and have my family live a comfortable and an easy life and to be able to enjoy lots of life experiences and be comfortable in life before I’m old and gray so really the journey began in about 2002 graduated from Iowa State University with a degree in marketing and business and by that point I have met my wife Kelly she had already graduated from school and she was kind of waiting for me and we wanted to move west out of the Midwest to move west see some new territory and get closer to the outdoors so I grabbed my degree ran out the door packed up my 1987 Ranger fully equipped with eight foot hay racks full of all of my personal belongings and we drove to Littleton Colorado and at this point in my life I had $200 in my pocket and Kelly had about the same so being completely naive and basically completely broke but with a degree I was on the search for the best suit and tie job that I could possibly find so I bounced around for a couple months just working some kind of halfway jobs and I quickly realized that I did not want to wear a suit and tie and I wanted nothing to do with the man and working a nine-to-five job well Kelly had found a job in a real estate office working the front desk and she had become friends with a couple of the big-time Realtors there one of which you caught wind that I had some handyman type skills but he made me a deal that if he paid cash for a house and I fixed it up that he would split the profit with us 50/50 and at this point in my life all I saw was dollar signs if I was completely blown away that there was someone that could pay cash for a house this is coming from a guy who had less than $200 in his pocket at this point it was pretty much scraping by I tried to hold back my excitement to him but naturally I said yes please let’s do that I was working the graveyard shift at Target stocking shelves I’d worked for 10 hours I would go home grab a little bit of breakfast and I’d head over to the property and work on it for another five or six hours I try and catch a few hours of sleep and then I would rinse and repeat it was at this point in my life that I learned a few different things one you really have to dig deep to reach your goals in life because I was not getting paid by the hour and at this point I didn’t know how much money I was gonna make I didn’t know if I would make $500 when this was all done or if I was going to make $5,000 when this is all done so I learned that a lot of things that can benefit you financially you have to put in the work upfront without knowing what your final outcome is going to be after about three months which seemed like an eternity of working seven days a week for sometimes 15 sometimes 20 hours a day on this house the house was ready to go on the market and it was all finished it looked great and then before you knew it it’s sold and then the house closed and at this point I still didn’t know what we were gonna make off it but for me it didn’t matter the hard part was done I didn’t have any of my own money into it I just had my time basically so the guy we were doing the investment with hands me an envelope and I opened it up and at $8,000 being twenty-two years old and having $8,000 I might as well have hit the lottery and that brings me to my second valuable lesson that I learned and that is being responsible with money so when you have $8,000 and you’re 22 years old a lot of people would go buy a new car they’d go buy some flashy things some pretty things but to me I had realized that if I can make $8,000 once I can make $8,000 again and again and again and again so I can either go p*&% the $8,000 away that I had worked my a#* off for or I can take that $8,000 and do exactly what he did but do it myself and potentially make twice or three times as much money so my wife being in a real estate office we became acquainted with quite a few smart people financially smart people we learned a lot about real estate very quickly because we were willing to learn which is my next valuable life lesson is that you never stop learning so we took our $8,000 we put a small down payment on a condo in Littleton because we realized that giving someone else our money was you might as well be throwing it away we wanted to be working towards something and it own something on our own so we took our other four or five thousand dollars and we started our search for a real estate investment that we could do all of our all on her own and get a hundred percent of the profits so after some searching we did find a place we found a small town home it was not in as nice of area as we were living it was smaller it needed lots of work but that takes us to our next light life lesson that we learned and that is to sacrifice for a greater payoff in the future so we had only lived in our condo for a very short time but we realized that if we moved into the real estate investment that we could rent out the place that we are living at and move into the place that we were fixing up that we’d have to be paying a mortgage on anyway we had our first real estate investment and we had our first rental so being 22 years old and owning two properties and carrying two mortgages and at this point I’m still working at Target was a pretty scary proposition in life but all I could see was that $8,000 check they had started to change our lives I also want to point out and kind of give a shout-out to my parents and to my wife’s parents because neither one of our parents ever handed us anything in life they always made us work for what we achieved in fact when we move we tried to convince my parents to co-sign on our mortgage for the condo that we bought and they said no way at the time I was very very mad at them and I thought I would never forgive them in hindsight it was one of the best things they’ve ever done for me because it just made me have that fire in my belly and really just want to work to get what I wanted so back to having two mortgages that was a completely scary thing in my life I was making something like 10 dollars an hour at Target I think Kelly was making $13 an hour at the real estate office she was working at we could barely afford the condo we had but now he had two.
God bless the banks lending money to anyone at that point on the very plus side of that we learned that someone else can pay our mortgage and we’re basically getting that money for free and then later we figured out that there are many many many tax benefits and huge benefits of owning a rental property so we quickly learned that trying to pay for materials and the things needed to fix up an investment property on just barely over minimum wage is not easy to do the thing that happened next couldn’t have come at a more perfect time so all of a sudden I had money to spend to fix up this house and it would just get me to that next big paycheck that much quicker so that’s what we did we fixed up the house we doubled our money we rolled it into the next one so we kept bouncing from house to house quite a few times and that sacrifice of from going from a nice house to live in to going to a crappy house to live in to fix up to making it nice again to going to another crappy house to fix up it became pretty stressful but we always had our eyes on the prize “are you still with me Murph?” after doing this two or three times I remember getting a check for the last one and the check was forty one thousand dollars so at that point it didn’t make sense to work at Target anymore so I just started doing it full-time but we never took the big proceeds from the real estate and put it into our actual living we always rolled it into the next property and that kind of gave us the baseline of even how we live today we always live well below our means we take the money that we make and we put it into things that will make us an income not into something that will lose us money but you do have to treat yourself every once in a while otherwise there’s no reason to make the money in the first place Kelly saw many of the high producing Realtors making large amounts of money so she decided to get a real estate license and she created her own real estate business so now we really felt like we had the world by the balls because we were getting paid a commission to buy the property and then we were saving half of the Commission when we sold the property and I was fixing him up so we just get rolling our profits in rolling our profits in rolling our profits in until family we were able to buy a house and now that we could get a house we were playing with the big boys the profits were much larger but so was the risk and we really didn’t want to lose all the way it worked for for the last couple of years so we did a few houses and we made some great money but instead of selling them and pulling out our profits we kept them as rentals and it was at this point that we really started building up our rental inventory at this point it was about 2006 or 2007 and real estate was starting to slow down a little bit but we have purchased a large house I’m a courage that was really a big risk for us it was a large house to fix up it was our biggest project for sure it took us the most money to fix it up and we had the most money into it so we lived in this house for about 8 months while we were fixing it up and we kind of decided after doing about 12 properties that the moving all the time was starting to get kind of old and we were kind of getting older ourselves and we decided that we wanted to have kids and kind of settle down a little bit Murph are you with me? sometimes I feel like I’m just talking to myself so after the eight months was up we finished the house we sold it and shortly after the real estate market completely crashed the bubble had burst and Colorado was one of the hardest hit States we got out of the house just in the nick of time and not only did the real-estate market bubble burst we found out that we couldn’t have kids and it seemed like a real low point in our lives but around 2007 when all this happened we realized our next lesson with every negative there is a big positive that can be gained from it and you can just use it as fuel for your fire so the recession was tough we thought our great life had come to an end we thought we were gonna have to get regular jobs you know people were losing their jobs left and right people were losing their houses Colorado was hit very very hard one of the worst states during the recession and we learned that what goes up must come down and in this case it came down hard in many cases not just real estate when things are bad that’s the time to invest and if you’re smart with your money and you’ve been saving while everyone else spending that’s the time to benefit though from about 2008 to 2012 we were buying rentals so we were able to adapt I started doing contracting because that’s pretty much what I was doing before but now I had to be doing work for someone else and Kelly’s always been a mover and a shaker and even a bad real estate market she was able to keep her business moving we were buying things for pennies on a dollar and even though we were not making great money and in some cases losing a little bit of money on rentals we were able to stick it out and after lots of lots of years of lots of lots of heartache and lots of lots of doctors we were able to have two boys so about 2014/2015 real estate started creeping back up again prices kept going through the roof and just when he thought it was the peak they just kept going up stuff was flying off the shelves you could list a house and it would have multiple offers within 24 hours so we had about age 35 we were completely debt-free we had several rentals that we were cash flowing we didn’t owe any money on the rentals so all that money was just rolling into a bank account when you have no bills and you have an income coming in your net worth starts to grow very quickly so we rode out the storm Kelly’s business was doing great my contracting business was doing great we have liquidated a lot of our real estate in Colorado we had capital to play with we had two beautiful young boys and then I fell to my knees crying like a little baby I had herniated a disc in my back and I was on a walker for about a month contracting for me was out of the question I didn’t even want to think about picking something up so I took some time off and I raised our kids which at first I thought would just be for a few months and then a year passed and then another year passed and I decided that I kind of liked it we had rental income coming in Kelley’s business was doing better than it had ever been in fact she had started her own she had several people working for her and just as a little side income I got to do what I love to do which is antiques I was just buying and selling antiques so we were trying to be very strategic at this point because we owned a fair amount of property in Colorado but we knew that our ultimate goal was to retire at 40 and at the rate things were going up we didn’t want to sell too early because we didn’t want to miss out on that upside but we didn’t want to sell too late because we didn’t want to risk the chance of taking a step back so as some regret we sold the majority of our properties in around 2017 but this was a game-changer because we were able to make cash for every rental that we purchased so we loaded up on rentals in Iowa we actually purchased our property that we’re going to move into which is actually where I’m headed now and that kind of brings us up to speed to current date I take care of our 10 rentals which keep which keeps me pretty busy just in itself i buy and sell antiques i get to see my kids all the time we have a good rental income coming in now we do youtube oh yeah we also do a couple fix and flips every year Kelly has her real estate team with about 10 employees and in June of 2020 we’re going to retire at 40 so all in all life is great I have a wonderful family I have enough assets and passive income to live a comfortable life
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Read More10 Proven Life Hacks for a Happier and More Fulfilling Retirement
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
[Songs] Retired life is a totally various stage of.
one'' s life, a phase, otherwise well prepared for, could result in a life of remorse as well as problem. While there is no universal formula on just how to retire well, there specify techniques.
that can assist you retire well. this video aims to run you via everything you.
need to learn about how to enjoy your gold years. Below’s something to contemplate: Have you.
ever asked yourself why some people retire well while others drift into the.
most bitter part of their lives? What is the trick to retiring well, and what.
did these individuals do in different ways to retire well? Is it about having a budget and purely maintaining to it? Or has to do with saving a significant.
percent of your incomes early? Or, did they get their by spending.
some component of their wealth wisely? These and a lot more comparable ideas run across.
my mind whenever I see folks that have been able to retire well, care for their tax obligations and.
get over all the challenges connected with retirement.After a great deal of research and. a great deal coffee exploring the topic, below’s what I figured out. If you desire to. reproduce their success, retire well, with
a considerable savings. Here’s. somethings you ought to maintain an eye on. Number 10. Your way of life A typical characteristic among individuals who are. retired well, as well as are in fact appreciating their retirement is exactly how wisely they. lived while still in the labor pressure. Have you ever listened to the stating” you can not. eat your cake as well as have it too”? Well, what this means in this context is that.
Living within or below your ways does not.
yourself; you can still be pleased as well as happy while stopping on your own from investing in. costly or luxurious items.This way, you can have something considerable from your earnings.
Strategy early Chatting concerning your retired life strategy while still in. As soon as you retire, you may not be able
to. You might often remain still throughout the
day when you ' re retired.
company to see if you can obtain some job lowered. By minimizing the amount of job you perform in a. day, as well as replacing it with activities you ‘re likely to do as soon as you retire, you will.
Number 7. Prepare on your own psychologically for retirement Even if you desire to, you can not take place working. permanently. At some time in your life, your body may not have the ability to take the stress and anxiety and also stress. associated with work. Retired life from work is, as a result a stable truth. The earlier. you prepare yourself mentally as well as permit that to
sink in, the much more
likely. you’ll enjoy your retired life years. Do not push the thought of retired life aside. Instead, involve yourself proactively about
how to take advantage of your retirement. Ask on your own. what you would finish with all the downtime.
Exist any kind of dream delegated be chased? Any type of ability. you ' re still interested in acquiring, such as discovering exactly how to play a brand-new instrument? Any one of this. might offer as a good usage of your retired life time.
The most essential point is not to remain lonely or still. Being less active will likely lead. to monotony, and also eventually clinical depression. Number 6. Keep friends outside. of your job associates When you retire, you will certainly require the company. of friends from time to time.Hanging out with friends, spending quality time together doing what. you all love, or chatting about subjects such as sporting activities or the excellent old days would certainly keep.
you in a light state of mind throughout the week. Number 5. Way of living modifications Retired life offers you the possibility to. make some vital modifications in your life, such as the top quality of food you eat. If you rarely had a well-cooked dish, prior to you retired. Currently, with even more time on your.
hands, you can ultimately change from
the undesirable eating pattern and also transform a brand-new leaf hereof. Food plays a substantial function in our health; you are what you consume. You can currently buy.
healthy and balanced meals or also get groceries and also prepare the best healthier meal on your own. And if you. can’t prepare, you have actually got regularly to discover how. Workout might additionally be one of those things. you previously couldn’t do as a result of your work routine. Now that you ' re retired, absolutely nothing stops.
you from trying a number of exercise routines. Exercise is restorative, and also I would highly. recommend it to you.Develop a simple workout routine, something you can pay for to do.
You can obtain a fitness display to aid keep.
you knowledgeable about your heart condition. Keep in mind that difficult workout may not.
In that situation, it ' s best to follow your medical professional ' s. Strategy daily Preparation your day allows you to schedule a. It ' s best to have a routine down of things.
He had always desired to find out just how to dance however never had the time.
He additionally does this. You can never ever catch him.
Individuals say retired life has a. Retirement ironically brought out the finest in. This freedom is valuable, as well as suitably, your retired life could.
That stage of your life mores than, and. you can never ever go back to being young and also vibrant any type of longer. Make peace with this. and find a method to proceed. Tell on your own you did your ideal and pay focus to your.
existing instead of dwell in the past.
Retired life presents you with something you gave.
up in childhood years, which is time. Do not spend this thinking back concerning what could have been done. The past is gone as well as never ever returning, so the earlier you recognize this and go on, the. quicker you can start to enjoy your retirement.Number 2.
Invest for your retirement One of the points that reduce against retiring.
To keep your present
lifestyleWay of life Always examine your health and wellness.
You ' ll be predisposed to some ailments as well as wellness problems as you age. This makes it required that you'occasionally go for a total clinical exam. This could. help you prevent or discover and treat'diabetes mellitus, cardiovascular disease, dementia, strokes, and also other. health problems before they come to be a risk. To conclude, most of us are various, as well as as a result, nobody formula applies to. every person'concerning exactly how to retire well. However, by taking on some of the routines and. economic techniques that have actually been shown to ensure a successful retired life
, your possibilities. of retiring well can be substantially increased.Well people, thank you so a lot for watching, like and also subscribe, as well as I ‘ll. see you all in the following one.
Strategy early Talking regarding your retirement strategy while still in. Do not push the idea of retirement aside. Rather, engage on your own proactively about
how exactly how make the most many your retirementRetired life Individuals state retired life has a. Retired life paradoxically brought out the finest in.
Early Retirement Success Story – How He Saved 12 Crores in His 30s | Fix Your Finance Ep 36
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
If you wish to retire early, then this video
is for you. Today we'' ll meet a male that has a corpus of
even more than 10 crores and has taken care of to retire entirely previously
the age of 40. We will certainly learn just how to begin intending, how to
do the estimations for early retirement and also what all points to bear in mind before
leaving your task. So view this video clip till the end as well as to support
our network, like the video clip now. TAKE CARE OF YOUR FINANCE Hey there and welcome to a new episode of Take care of
Your Financing. Today I have Ravi Handa with me. Invite to the show Ravi. Glad to be here. Exactly how'' s very early retired life treating you? It has its excellent parts clearly. What are the great parts? You can hang around on points which you were
not able to do earlier.And what are several of the negative components of retiring early? You lose a great deal of value and also a great deal of validation that you made use of to get from
a task. You have actually explained your retired life in 2023. Let ' s take it back to such as 15-16 years back. What did you study? I have done design in computer system scientific research. And also what was your initial task? Where did you begin functioning? I began functioning in the education market itself. I signed up with IMS Calcutta which is a pet cat mentoring company.
The last 1-1.5 years of my functioning career, I was with Unacademy as supervisor web content sales. How several years did you work? Due to the fact that I don'' t believe anyone was doing it.
actually compete. On an average, what was the sort of earnings.
or wage that you individuals were attracting? We had excellent years when we did earnings of.
3 crores too. We had bad years when we did incomes of 25.
lakhs as well. There was massive fluctuation.In 2021, your company
obtained gotten. Correct. It got gotten and after that there was that vesting.
period wherein you had to function. Correct. And afterwards, you got a leave. Correct. Were you actively looking for an exit? Yes. Once again, I am informing you the exact same. So, throughout the COVID duration of 2020, my spouse was expecting then of time, So, my wife as well as I used to sit and talk around.
what to do with life. And also this is what emerged that we have to offer the company at whatever assessment feasible, whatever type.
Due to the fact that obtaining out of service is the top priority. Specific numbers I can'' t disclose because of the. You have a lot of money in Edtech, I am.
This I obtained largely since they were obtaining.
my firm and this is a way for them to pay the.
Did that also help in your, you know, starting your business trip? I am informing you, there are a few points which have actually helped me a whole lot in life. One, my parents were constantly independent.
my moms and dads. The second thing which has actually truly helped me.
is my wife was quite possibly educated and in a great.
job which allowed me to take a whole lot of dangers. The third is that I mosted likely to a good college and also with that college, you build a network. I have good friends in elderly placements in numerous.
areas. This is it. You are the sum of your benefit, your history and also the people that you have interacted with over your life.Okay, so now we will speak about your expenditures. Do you reside in a leased apartment or is it. an owned? It ' s a possessed flat'. I changed to Jaipur in 2015 to be closer to.
my moms and dads and also then of time, I purchased the.
level that I still stay in today. Did you take it on lending or did you pay in.
cash money? No, it was entirely in cash money because at that.
point of time, I had been doing service for 2-3 years. The 2nd point is your travel. Do you have an auto or do you travel in.
taxicabs? I have a cars and truck yet I don'' t truly like to drive.
that much.So, just how much gas do you invest in a monthly.
You don'' t track expenditures in general? The means I track expenses is at the beginning.
of the fiscal year, I check how much money remained in the financial institution account. Throughout the year, I simply discover how much.
money headed out of your financial institution account. So, that'' s just how I establish just how much I spent. this year. On an annual basis, how much did you spend. in the last 3 years? Around 2 lakh rupees goes into maintenance. Culture, maintenance plus the various other property.
that I have. 5-7 lakh rupees is the vacation. One more 2-3 lakhs would be dining in a restaurant, drinking,.
events. Parties, not the bar parties. Moms and dads' ' 50th anniversary, the very first birthday celebration.
of the child. All these parties add up. 3 lakhs or a little bit more than that would certainly go.
towards your home help staff.These are the
big hits. Now, it is time for the important point, which is speaking regarding your economic self-reliance.
and also retired life strategies. The first and also important things is finding out your.
FIRE number. Exactly how much cash would I need to not function and can retire pleasantly. So, in which year did you seriously begin.
Which year? 2020 is when I really sat down and also did the.
numbers. Where I have this much cash, I will certainly place this.
cash occasionally. So, it took me around 3 months, maybe 6 months to figure out just how much money I specifically require,.
just how do I require to invest it.And then it took me a couple of years, 3 years.
to carry out that. So, if your yearly expense is 25 lakhs, if you take a several of 30, it is 7.5 cr. ? What are some of the turning points that you.
thought about? There are two major portions that I have kept. Among them is almost everyone likes as well as approves.
I have set aside 50 lakh rupees for that. I will certainly provide it to him at 18 or whatever ideal.
7.5 Cr plus 50L. Another 50L is what I wanted to keep as a.
sort of play money cash experiments that I would would certainly desire do.Angel investing is one of them. Crypto financial investments is one of them.
You should take a look at his YouTube channel,. okay? Monthly, 2 videos show up specifically. discussing exactly how to achieve FIRE. Okay? There is a web link in the description. Absolutely subscribe. That is 50 lakhs, your play money.How is that passing the means? Angel financial investments and also other financial investments? I have actually lost a whole lot of cash in angel financial investments. I have actually shed a little of money in crypto. also. But the biggest trouble in angel investments. is that it is incredibly illiquid.
There is no honesty. I had actually put 3 lakh rupees in a firm in.
Did you obtain an exit? The business closed in 2023. That'' s why you have actually allocated an amount which you yourself have actually called play cash.
quantity since 2015. You began spending or saving much more. From 2006 to 2015, did you handle to conserve any type of part of your.
We utilized to save this much.So, it was company, revenue was high, that'' s. why you didn ' t conserve. Your expenditures were always lower than what. Exactly how much portion of that, if you are comfortable.
sharing, just how much percent has come from marketing.
your business and also just how much percentage of the percentage.
has come from your financial savings? I would certainly claim that offering the company probably.
provided me 20-25%. Which essentially means that this was not a.
outcome of a particular occasion. No, no. This was because my organization was effective. The second aspect was that my costs were.
really low. The third aspect was that I constantly had significant.
financial investment in equity. The 4th variable is where I would state the.
selling of the firm comes in. The major money that was made was made by organization. And also allow'' s claim if you were doing your software. work, you would certainly have remained in the leading positions, Because instance, do you believe this much wealth.
buildup would have been feasible? If I was in India, then no.If I had actually travelled, then I would have been.
way in advance of this. Is that one of those points that you would certainly,.
you recognize, you recall and want to transform? I regret it each week. If I had been a great student, if I had studied.
in college, then I wouldn'' t have remained in the training. line. I would have transferred to the US or Canada or.
Europe or someplace after college. Due to the fact that I have actually jumped back from the errors.
of not examining in college. Yeah. The 8.5 cr that you have gathered, that too, what are the percents where you.
have spent? My existing total assets would certainly be somewhere in between.
12-13 cr. Out of this, 1-1.5 crore rupees, which is.
In the medium term pail, I have actually taken a.
balance equilibrium benefit. I have long term bonds, gilt funds, which is one more 4-5 years of expenses. 3rd container, which is my lengthy term pail, an additional, I believe, 6-7 crores would be in.
that and after that there is a parcel that I have.
which is around 2 cr.Tell me one point, how to tackle it? Mainly if you are young you require to save,.
create as a practice type of a thing yet your focus need to be on generating income. Where will you make money from? Either you will certainly grow in a task or you will.
join high-risk work like start-ups to obtain ESOPs or you leave the nation, you travel you.
earn a whole lot extra there, you conserve a great deal even more there as well as you come.
back as well as you understand you can be in a great scenario or what you do is you obtain a greater.
degree. Suppose you have actually done engineering, MBA, Masters.
in Design, there are a lot of avenues.Your primary emphasis ought to be on making more and. a growing number of money. Due to the fact that after one factor your expenses can ' t. get much less.
If you desire to boost the alpha, the.
distinction in earnings and costs that will only take place if you are constantly concentrating on enhancing.
Allow'' s state I have made a decision that I desire to retire. What were some of the idea procedures? One according to me even really hoping for planning.
for layoff is kind of approving a failure that you couldn'' t make your career.
in your life much better that'' s why you are going towards retired life. Yes economic freedom is essential, early.
retirement is not. If you remain in a task that you like, that you.
enjoy or I will certainly claim if you remain in a job or in a profession that you don'' t hate, do not think. around early retirement.Early retirement became vital for me due to the fact that. I wasn ' t taste what I was doing. So this is our quick money round. You need to address the questions as quickly as. possible. If you had an unrestricted spending plan,
what would certainly. you present your better half? Vacation, deluxe holiday. If money was out of factor to consider which in. your instance is true, what would certainly you provide for a living? I put on ' t understand I will keep try out. it which is what I am doing now.
As well as the last concern is for individuals who desire. to achieve economic freedom as well as you recognize are seeking layoff, what are. 2-3 nuggets of advice that you would share with them? For monetary freedom, raising your. income as a lot as feasible that needs to be your priority.The second priority should be that mass of. your cost savings ought to go into equity.
If you are chasing very early retired life, I believe.
that is a poor chase to have. That should be, that resembles surgical treatment, that. should be the last option. Try transforming your task, attempt altering the city.
If there is no avenue, that is when you assume. I am certain that a whole lot of individuals have actually found out.
a great deal from today ' s episode and video. Ensure to take a look at his YouTube channel.
Every month at the very least 2-3 video clips are made on. Anything in this video, subscribe to my network.
Let ' s take it back to such as 15-16 years back. We made use of to save this much.So, it was business, revenue was high, that'' s. why you didn ' t conserve. Because after one factor your costs can ' t. obtain less.
I wasn ' t preference what I was doing. I put on ' t understand I will certainly keep experimenting with.
How to Retire Early: The Shockingly Simple Math
Jason 0 Comments Retire Wealthy
Hi, my name is Phil. I’m a video creator and online instructor. I’m also a personal finance nerd. Because of that, I want to create a series of videos that breaks down some of the most mystifying topics that plague our society. In a world where people’s finances are typically locked away and not-talked about, I believe opening up the gates of financial conversation will help everyone live a better and smarter life. In this first video, I want to explain the shockingly simple math behind early retirement – thanks to one of my biggest heroes, Mr Money Mustache. While the ability to retire may seem like a distant and unreachable goal for many, the premise comes down to one thing. You need to invest money so that it earns more money.
This could be investing in stocks or bonds, real estate, or any other of investment vehicles. As soon as your investments earn enough money for you to live on each year, you are able to retire. Let’s break it down further to know when you can retire. The most important concept is knowing your savings rate, basically how much you make minus your expenses. If you spend 100% of your income, you will never retire… because you will never be able to invest any money that earns money for retirement. If you spend 0% of your income, you can retire right now… because somehow you are living without needing to make any more money. Between 0% and 100% are a number of savings rates that correlate with the years it will take to retire. For this, let’s assume your annual investment return is 5% (which is conservatively low) and your withdrawal rate is 4%… meaning you spend 4% of your net worth each year.
For example, if you have a $1,000,000 net worth, and you live on $40,000. If your savings rate is 10%, you will be able to safely retire after years. Safely, meaning you will never run out of money. If your savings rate is 25%, you can retire in years. 50%, you can retire in years. And if you can somehow save 75% of your income, you can retire in years. Now getting to that savings rate might not be easy in our world of societal pressures, keeping up with the Joneses, and bad habits. But you can get closer by making smart decisions, avoiding debt, and living simply. The key take away is… Cutting your spending rate is way more powerful than increasing your income because no matter how much money you make, decreasing your spending will speed up the process. A note, The math behind early retirement works if you are working a minimum wage job or a 7-figure CEO salary. It’s all about the savings rate. So if you want to retire in 10 years, the math tells us that you need to save 66% of your income. Now there is a lot that I didn’t talk about – like how to invest, and how to cut expenses to get to a high savings rate.
Those will come in a future video. For now, get excited about the honest truth about retirement (and early retirement at that!)! Let me know what you think in the comments below? Is this exciting or bogus? Until next time… start being money smart. .
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Read MoreHow to Retire in 9 Years Starting With ZERO (A 5-Step Guide)
Jason 0 Comments Career after Retirement Retire Wealthy
are you over the age of 50 with no plan in sight for your retirement don't worry there's still hope it's never too late to get started hey guys welcome back to the channel in today's video we're going to teach you some tips on how to plan for your retirement even if you are starting late in life first of all you need to know that retirement is freedom which means that when you retire you should be able to do whatever you want whether to travel to your favorite destinations spend more time with your family or work on your own projects so let me take you through the steps of your journey to financial freedom first step is to cut your expenses write down all your monthly expenses think of your main fundamental expenses as your running cost as if you're running a company things like rent builds groceries internet so you can watch more of our videos and car payment remember that you could always find cheaper alternatives for some of your main expenses for example you could always move to a cheaper house and save on your rent or if you have a rental car you could rent a cheaper car that also matches your needs the key here is not to minimize your quality of life but to minimize the amount you spend on that quality now write down the other expenses that you could survive without this might differ from one person to another it could be your netflix or amazon prime subscription or it could be the designer clothes that you usually buy these are the items that you could totally scratch from your expenses the more you cut the more you save and in the fifth step i'm going to tell you how we are going to use all this extra money to get you even more money always remember that it's not about how much you earn is what you keep you could be earning much more than others but you're also spending much more than they do keep monitoring your expenses you can do this through a simple written list or even through apps such as zoho expense or expense point second step is to set your expectations remember when we said in the beginning of our video that retirement is freedom well you need to think of your freedom figure which is basically the amount of money you expect per year after your retirement now multiply this number by 25 i'm sure you will get a crazy seven figure number this is going to be your goal i bet you're thinking now that it's impossible but please don't close the video yet because in the last two steps i'm going to show you how you can make this possible you need to lower your expectations for the time being in order to get those results in the future it's a match a fight if you will wealth versus cash flow set your own goals for now and for the future not based on what you see around you or on social media it doesn't have to be a 25 million dollar mansion in beverly hills a huge yacht and a supercar but that doesn't mean you shouldn't be enjoying your retirement it's about being realistic and aware of your situation what you can achieve in the future third step is to consider working longer now i know what you must be thinking i'm watching this video to know how to retire early but bear with me you may retire by the age of 60 or even 65.
But if you retire by the age of 70 you are increasing your social security check to nearly double plus there's also more money going into your 401k what's 401k oh you didn't know well i will explain this in the next step if you can't bear the thought of staying at your current job any longer than you need to then you should look into quitting your current job and finding another one something that you will enjoy more you you'll be surprised at the amount of companies that are currently looking for workers with experience be aware of your physical health keep up with your regular medical check-ups eat healthfully do any form of physical exercise could be something as small as taking a relaxing walk every day all this keeps you energetic so that you may continue working at the top of your game fourth step is to open an investment account this account could be funded by the money you save as a result of cutting expenses remember step one or you could open a 401k account if you don't already have one a 401k plan is a company sponsored retirement account where employers can contribute their income and employers usually match contributions up to a certain amount there are two basic types of 401ks traditionally and roth which differ primarily in how they're taxed with a traditional 401k employee contributions are pre-tax meaning they've reduced taxable income ban withdrawals are taxed during retirement employee contributions to rough 401ks are made with after tax income there's no tax deduction in the contribution year but withdrawals are tax-free so if you don't have a 401k yet what are you waiting for start one and make use of all this non-taxable income now it's time to invest your money which takes us to the last step the fifth and last step is to increase your income well you can always ask for a raise in your current job if the thought of asking for more pay sounds daunting then you can try looking for a new job with a better salary which may not be as challenging as you think there are many ways to promote your skills and experience to other companies you can upload your resume to sites such as indeed.com or linkedin.com let the companies come to you but there is an even easier way to increase your income through a side hustle one of the easiest ways to do so is through creating an amazon individual seller account it's free to create but you need to pay a commission of 99 cents for every sale that you make on amazon not intrigued yet hear this according to a recent survey of amazon sellers twenty percent make between one thousand dollars and five thousand dollars per month which i believe is great for a side hustle or even a decent second income you can even sell your own private label products on amazon around 67 percent of all amazon sellers run their business using the private label method private labeling is a process of manufacturing a pre-existing item preferably with product improvements putting your branding and logos on it and selling it to consumers sometimes it is referred to as wide labeling or brand creation the process has been around for years and is common in countless retail stores targets mainstays brand and walmart's great value are two examples of private label brands your site hustle could also be building websites or content writing there are millions of ways to start a site hustle it's all based on the set of tools that you possess be sure to check out my videos covering this topic and i'll post a link in the description below and remember you can always learn a new skill and this skill could be your next source of income so never stop learning another way to increase your income is by creating a passive income stream passive means you don't actually need to actively trade your time for money you are basically making money while you sleep there are three ways to earn passive income stock markets you don't need to call a local broker anymore there are plenty of applications that you can use to trade stocks that's what makes it the easiest way to gain passive income i'll post some links in the description below for some of my favorite exchanges that i use to trade stocks and crypto cryptocurrency is part of the new modern era with many ways for you to earn passively if you are willing to accept its high risk prices of cryptocurrencies including bitcoin have been falling in 2022 amid a worldwide crypto price crash this could also mark a perfect opportunity to buy with prices being so low check out this video i made where i go over the top five cryptos that billionaire kevin o'leary from shark tank is currently investing in but remember be wise when investing in crypto never put in more than you are willing to lose other options include real estate it's harder to get into it as you need to save up enough to pay for a down payment once purchase you can then get a tenant to rent out the house which will cover payments on the mortgage and hopefully a bit more use any cash flow to pay down the principal faster after a few years you will have paid off the house and can now enjoy some free cash flow from your rental property the earlier you start doing this the sooner you can pay off the mortgage debt now that we have been through each of the five steps of your journey to freedom keep this in mind your life is not going to change unless you take the initiative a nine to five job alone is not enough to build wealth have faith in yourself have faith in your abilities you're not alone in this situation and if other people can do it so can you improve your physical and mental health this will keep you more focused and energetic to work on your goals and it saves you from spending a lot of money down the road on treatment and medications this is it for me today i hope this video has given you as much hope as it did to me don't forget to hit the like button and subscribe to our channel watch our previous videos you never know what piece of information could change your life
Read MoreHow to Become Rich | Retire on $10 a day
Jason 0 Comments Retire Wealthy
Is it possible in this day and age to become a millionaire? Or perhaps the better question is: why would you want to become a millionaire? I mean, in the media today, millionaires—and billionaires for that matter—are often not depicted in the best light. Characters like Scrooge McDuck or the always supremely evil C. Montgomery Burns come to mind here. And of course, right now in real life, we have the ever-present Donald Trump as one of the main poster boys for the super wealthy. So, I suppose, with that kind of media influence hovering over us our entire lives, it’s not surprising that most of us have a fairly negative view of the super wealthy, and many really do not want to become a part of it. Especially since the majority of us don’t personally know anyone who’s super rich, we don’t have anything to really balance the scales, and all we really have to draw upon is what we see in the media.
And that’s really unfortunate because there are a lot of really great, wealthy people out there. But most of them are not in the public eye, and even the ones that are, like Bill Gates, don’t get as much media attention as someone like Donald Trump does. And as a result, there are a lot of misconceptions about millionaires and the wealthy in general. Hey guys, Daniel here from Next Level Life, and it recently occurred to me that I’ve been neglecting a huge part of what it takes to have that next level life that we all dream of, because whatever your dream life is, you need to have the financial resources in place first to be able to live it.
So with that in mind, I’m going to be starting this new series on my channel, covering various topics in the field of personal finance. And as you can see by the title of my first video in the series, I wanted to talk about a simple plan that, if stuck to, will practically guarantee your future millionaire status, as well as take a moment to really define what a millionaire is and is not. Because, believe it or not, even for the average American, it is possible. No, you know that possible is too soft a claim because it’s more than possible. In fact, if you follow a few simple steps, it’s almost guaranteed. Don’t you believe me? Well, hopefully over the course of this video as well as the rest of my personal finance videos that will be coming out soon, I’ll be able to convince you. So without further ado, let’s get started. What is a millionaire? A millionaire is simply someone who has a million-dollar positive net worth. Meaning, after subtracting debts and other liabilities and expenses, they have a million dollars worth of stuff leftover between their cash, their house, and all their other assets.
That’s really all there is to it. It has nothing to do with how much money you make. It has nothing to do with what type of person you are or how well-known you may be; it simply means that your assets are valued at least 1 million dollars greater than your liabilities. But how can the average American get to that $100,000 in positive net worth in their lifetime? I mean, at $100,000,000, that’s 6 zeros. I’d imagine that most of us have never written a check with more than three zeros. Unless of course you bought a new car or house with cash, and if that’s the case, kudos to you, you may not even need this video because you’re already probably well on your way to that million-dollar net worth. Now, I said that if you follow a few simple steps, you will almost certainly reach the million-dollar mark.
Let’s find out how. Well, I did a few calculations and found out that over the course of the last 40 years, the S&P 500 has returned an average of % per year, not including dividends. Now, technically speaking, past results are no indicator of future returns, but until we see the future returns, this is the best we’ve got to go off of. So assuming that over the next 40 years the market does roughly the same as it has since 1978, you could invest $2 per month over the next 40 years and become a millionaire. Again, assuming no dividends Now, 261 dollars may seem like a lot, but when you break it down, it’s not even $10 a day, and there are lots of ways to save money. You can cut cable, or go down to a lower internet speed, or not eat out quite as often, or use coupons when you’re shopping for groceries, or you can do none of those things and instead find a way to make a little bit of extra income.
Maybe you start mowing lawns or shoveling driveways on the side; maybe you start selling old clothes that you don’t need anymore online; or if you’re young, you might be able to start teaching people how to use social media better. You’d honestly be amazed at how many people would pay you to do that. There are a ton of options out there; all you have to do is pick the one or maybe a few that work out the best for you and start your own journey on the path to becoming financially independent. Now there are a couple of things that I want to clear up before ending the video for those of you who are a little bit more analytical in nature. That percent is the geometric mean rate of return that the S&P 500 has had since 1978, according to Yahoo Finance. All I did to get it was go through each year and look at where the market was in September, because as of the recording of this video, September just ended.
Then I put them all into the Excel spreadsheet and calculated the return. And I think the reason why we hear so many different rates of return thrown around by financial gurus is because of the inflation effect. I’ve heard gurus say that you can expect to earn anywhere from 6 to 10% per year in the market. And depending on what time frame and type of average you use, any of those numbers could be true. For example, if you go back to 1978 and use an arithmetic average, the average return on the market would be about percent per year. Inflation is generally assumed to be about three to four percent, so if you adjust for inflation, your realized return would be somewhere in that 6–7% range. If you don’t adjust for inflation, of course, you’re looking at a nearly 10 percent return. So there you go—there’s a simple formula for retiring with the amount of wealth that most of us would consider to be rich.
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