My mother was 56 when she died, only 5 yrs after she decided to quit her job and follow her dreams. I'm already saving a minimum of $15k a year and once I pay off my car next year, I'll be saving $24k a year. But I am also 30 and I love to travel the world. Knowing how short life can be, the best thing I can do is to maintain balance in my life. "Plan like you'll live forever and live like you'll die tomorrow." I've figured out a way to do both.
Would you have done anything differently while you were saving aggressively if you could go back and do it again? Glad to hear that you successfully became financially independent and are loving the results! :)
Couldn't agree more! We focused on attaining assets to pay ourselves and utilize that money to pay off any debt which helped especially during a time like this!
I see slow fi as a way ordinary people especially those with kids can still reach fi. It's not about "enjoying the journey itself". It's about granting access of this extraordinary life option to average people.
I'm at the opposite for my case that I am an adult child (still single) looking after my elderly widow mother which I think that slow fi is most suitable in my situation. At first that I'm kinda pressured of doing lean fire but then this will cause clashes with my several relatives and family members so I think that doing slow fi will be alright for as long as they won't drag me to unnecessary spending often.
@@NextLevelLife We just posted a video about our sacrifices and decisions in our 20s that allowed us to accrue wealth in our 30s on our path to financial independence in our 40s!
Black March But what’s the difference between someone who started work at a company in the 80s at 23, worked for 30 years and retired at 53? It’s the exact same concept.
Thank you. I literally just wrote this. Slow FI is a new name for an old concept. It’s basically regular retirement, but on your own as opposed to being beholden to a pension.
"You only get one life"...AMEN. I'm 31 now, working to reach FI in my early 40's. Investing in High Dividend Stocks, maxing out my 401K for several years now and currently own 3 rental properties, 2 are paid off. I would love to be making videos of how I achieved FI in a decade or so.
I'm aiming for similar, maxing out 401k and 65-70% savings rate. But I have no rental properties. Would you say it's worth the effort and time you spend on it, is the risk worth it, and have you been able to generate the 15-20% internal rate of return? So far I haven't found any real estate in my local area that I like. Would you be on the same path if you bought VOO instead of houses?
Sloth honestly it’s hard to compare apples to apples but I think VOO would have been the better purchase. The rentals are generating income but more like 8% return but tenants losing jobs killed me they ultimately broke the lease (has happened in each rental once), I believe I had bad tenants before and good now. Until things are all running very smooth I’m going to continue investing in growth stocks. My savings rate isn’t quite as high as yours but I’m getting there.
We also need to remember the time value of money. Money available now is worth more than the same amount in the future. So you can choose a faster way of accruing money, and then make your money make more money for you by investing it.
I do FIRST(Financial Independence Reclaiming Structured Time). Similar to slow but with no set deadline and more focused on doing what you want and still making money.
@7:00 Here's my take: Know where you live. Not all areas of the country are created equal. You'll have to figure out a few things first such as 1) at my job, is there better opportunity after taxes paid elsewhere? 2) How entrenched am I where I currently live? (mortgage vs renting the most prominent example) 3) Am I happy or unhappy with my life situation? I prefer quick and have done a lot of struggle to make it happen. You'll discover where that line is between what's too much and what isn't. My recommended expense targets: 25% living expense, 10% auto expense, 15% existing and optional expenses. I split the rent in a smaller apartment, I buy used cars, I don't eat out; I average one fast food trip monthly. I watch my optional expenses very carefully and anything past $50 is never allowed to be an impulse purchase. I'm a hardliner on this. I've forgotten lunch for work and won't pay the convenience fee because if you don't "punish" yourself and reward yourself instead, it can be difficult to stop that behavioral spiral. The minimum saving target is 50%. In times with large amounts of overtime, the saving rate can touch 90%. I would always avoid a mortgage situation until you can build enough cash flow in taxable accounts to at minimum, pay 50% of the mortgage payment. Obviously any percentage below 105% will require an emergency fund to cover expenses, which is good practice anyway. Lastly, if you're making progress, reward yourself but think small. Example: I basically skipped all luxury food items until recently. I've begun treating myself and my roommate to a skillet steak; my favorite meal of the week. The most important thing other than budgeting correctly is making life choices that will allow you to save the money you need because it's not easy to overcome financial legal obligations. Make choices with less impulse and choose your friends and dating interests very carefully.
80 bucks a day into a big cap index fund starting in 1995, 25 years ago, dividends reinvested but taxes paid out of pocket...today would be about 3 million and dividends of 250k per year
Often you have no choice, but to work on hinh-stress, low-paid jobs, having no FI in your 30s or even 50s. There's not many choices out there in reality.
I totally agree with you. It was few years ago. I was so stressed and anxious because I could lose my income any time. I decided to check all my finances and started saving/investing hard-core for five years nonstop, it was extremely hard to not travel and going out as much but now I do sleep with no worries and no longer stressed if I happen to loose my job.
I’m commenting this before watching the video but I’ve read up on Slow FI and it just seems like normal retirement to me. Am I missing something? Back when pensions existed there were a lot of people who were able to retire in their 50s. Is the difference just that the burden of saving for retirement is now the retirees or does it have to do more with intentionality within the process? Would appreciate any insight.
They can be. That's why I always prefer to focus on the FI part over the RE part. If my tenants cover my expenses, lifestyle spending AND allow me enough leftover funds to continue investing then - with an emergency - even amid a recession - I'll be fine. I imagine most of the people who are unfortunately being "slaughtered" right now were probably BARELY ready for RE (Retire Early).
Nope, the entire system of FIRE is built around a withdrawal rate that works even if there's a massive downturn right after you retire. Some of them are probably at risk, but plenty are doing just fine.
Not necessarily. Part of the strategy will surely be to have enough cash to live on for a year or two before relying on withdrawals from the market, in order to protect investments.
I really enjoy and appreciate your vedio i was wondering what was your take on the magic formula and if it really works would love to see the numbers and if it still works after all this year the person name is joel greenblatt thank you for all the information you have given to the public it has helped me a lot
Dave, to be perfectly honest I haven't got around to reading Greenblatt's book on the subject, yet. I have a rough idea of what his formula's focus is, but I'd like to get a more thorough grounding in it before doing a video on the subject. I'll add it to my list of potential future video topics so I don't forget about it (I think it will go good with my investing strategies series down the road), but it will be some time before I can make a video on it. I hope you understand! Thanks for the suggestion and I'm glad to hear that the videos have helped you so far :)
Income does matter though. Someone making 10k/yr saving 99% of income wont retire (@100k/yr) as fast as someone making 100mil/yr saving 1% of income. these are extremes but prove the point.
It's interesting to see how living on 30.000$ Sounds like deprivation on this video and families with children manage to save money with the same budget.
Same issue as the last video. You need to address the impact of inflation on the value of money at FI. I'm unsubscribing since you continue to ignore this critical point and greatly diminishing the validity of your presentations.
Let me start off by saying I'm just trying to understand and learn since I'm new to the whole financial thing. With that being said can you explain a little more of how inflation impacts someone's retirement goal
@@AnjelEYez614 30 years into the future prices for food, clothing, and other items will likely cost more due to inflation. Inflation over the last 50-100 years has averaged 3.1% per year. So costs for purchased items can be expected to increase by about 3.1% per year if you use historical data. The recent data, however suggests inflation may only be 2%. Even so, after 30 years, 2% inflation makes a $1 item into one that costs $1.80. If one extrapolates those costs into an expected yearly spend of $50K in today's dollars, that becomes $90K 30 years in the future. And conversely, 30 years from now, $50k will have the buying power of about 27.8K in todays dollars.
@@shayslay3416 No, you are missing the point entirely. I'm talking about the impact of inflation on the buying power of your dollar in 30 years compared to today. So, saving up to cover todays costs makes no sense. You are saving for tomorrow's dollars.
My mother was 56 when she died, only 5 yrs after she decided to quit her job and follow her dreams. I'm already saving a minimum of $15k a year and once I pay off my car next year, I'll be saving $24k a year. But I am also 30 and I love to travel the world. Knowing how short life can be, the best thing I can do is to maintain balance in my life. "Plan like you'll live forever and live like you'll die tomorrow." I've figured out a way to do both.
Love that quote
Could you share more about your way? :)
im so sorry for your loss brother but I appreciate the wisdom you have shared.
That is a sad story. I felt so upset when I lost my grandparents. I hope you are OK and it is so inspiring that you are so well on your path.
If you die it doesn't matter though. Sorry about your mom.
I did it fast, but it was really hard, I sacrificed a lot and worked a lot, of course today I am happy about the results.
Would you have done anything differently while you were saving aggressively if you could go back and do it again? Glad to hear that you successfully became financially independent and are loving the results! :)
@@NextLevelLife today, I learned, that focusing on assets is more important, than solely saving and paying off debt.
Couldn't agree more! We focused on attaining assets to pay ourselves and utilize that money to pay off any debt which helped especially during a time like this!
@@DrsGanandMo Absolutely.
@@tomyshaw977 We just started our channel on healthcare finance and paying off debt while investing..on the road to financial independence!
The first $1M is the hardest and takes the longest. Compound returns increase the velocity to FI after that.
I see slow fi as a way ordinary people especially those with kids can still reach fi. It's not about "enjoying the journey itself". It's about granting access of this extraordinary life option to average people.
That's an interesting perspective and I find myself agreeing to a degree. As someone with kids this is my struggle.
I'm at the opposite for my case that I am an adult child (still single) looking after my elderly widow mother which I think that slow fi is most suitable in my situation. At first that I'm kinda pressured of doing lean fire but then this will cause clashes with my several relatives and family members so I think that doing slow fi will be alright for as long as they won't drag me to unnecessary spending often.
Sacrifice is only temporary. Financial independence and the reward is forever! Great stuff!
Not if you die young
Or lose it all.
I couldn't agree more about the rewards being forever! Well said :)
@@NextLevelLife We just posted a video about our sacrifices and decisions in our 20s that allowed us to accrue wealth in our 30s on our path to financial independence in our 40s!
Slow FI sounds a lot like good old-fashioned "living within your means" and "saving for retirement". These aren't new concepts. What am I missing?
This is not a new idea.. most people just don't do it.
Black March But what’s the difference between someone who started work at a company in the 80s at 23, worked for 30 years and retired at 53? It’s the exact same concept.
Thank you. I literally just wrote this. Slow FI is a new name for an old concept. It’s basically regular retirement, but on your own as opposed to being beholden to a pension.
"You only get one life"...AMEN. I'm 31 now, working to reach FI in my early 40's. Investing in High Dividend Stocks, maxing out my 401K for several years now and currently own 3 rental properties, 2 are paid off. I would love to be making videos of how I achieved FI in a decade or so.
I'm aiming for similar, maxing out 401k and 65-70% savings rate. But I have no rental properties. Would you say it's worth the effort and time you spend on it, is the risk worth it, and have you been able to generate the 15-20% internal rate of return? So far I haven't found any real estate in my local area that I like. Would you be on the same path if you bought VOO instead of houses?
Sloth honestly it’s hard to compare apples to apples but I think VOO would have been the better purchase. The rentals are generating income but more like 8% return but tenants losing jobs killed me they ultimately broke the lease (has happened in each rental once), I believe I had bad tenants before and good now. Until things are all running very smooth I’m going to continue investing in growth stocks. My savings rate isn’t quite as high as yours but I’m getting there.
We also need to remember the time value of money. Money available now is worth more than the same amount in the future. So you can choose a faster way of accruing money, and then make your money make more money for you by investing it.
I do FIRST(Financial Independence Reclaiming Structured Time). Similar to slow but with no set deadline and more focused on doing what you want and still making money.
Slow and steady wins the race. Good teaching lesson!
So happy you gave credit where credit is due and referred to The Fioneers!
@7:00 Here's my take: Know where you live. Not all areas of the country are created equal. You'll have to figure out a few things first such as 1) at my job, is there better opportunity after taxes paid elsewhere? 2) How entrenched am I where I currently live? (mortgage vs renting the most prominent example) 3) Am I happy or unhappy with my life situation?
I prefer quick and have done a lot of struggle to make it happen. You'll discover where that line is between what's too much and what isn't. My recommended expense targets: 25% living expense, 10% auto expense, 15% existing and optional expenses. I split the rent in a smaller apartment, I buy used cars, I don't eat out; I average one fast food trip monthly. I watch my optional expenses very carefully and anything past $50 is never allowed to be an impulse purchase. I'm a hardliner on this. I've forgotten lunch for work and won't pay the convenience fee because if you don't "punish" yourself and reward yourself instead, it can be difficult to stop that behavioral spiral. The minimum saving target is 50%. In times with large amounts of overtime, the saving rate can touch 90%.
I would always avoid a mortgage situation until you can build enough cash flow in taxable accounts to at minimum, pay 50% of the mortgage payment. Obviously any percentage below 105% will require an emergency fund to cover expenses, which is good practice anyway. Lastly, if you're making progress, reward yourself but think small. Example: I basically skipped all luxury food items until recently. I've begun treating myself and my roommate to a skillet steak; my favorite meal of the week. The most important thing other than budgeting correctly is making life choices that will allow you to save the money you need because it's not easy to overcome financial legal obligations. Make choices with less impulse and choose your friends and dating interests very carefully.
More financial independence and FIRE videos please!
Great topic. Having more options and letting people decide what works for them is always better than swearing by a single option.
Couldn't agree more! It's all about finding what works for you and going with that :)
i saved nothing in my first 2 years
saved 50% next 4 years
saving my 90% income for last 4 years
within 6 months wish to retire @33
no debt atall.
if you want to get to the slow fi topic directly, move to 8:30
80 bucks a day into a big cap index fund starting in 1995, 25 years ago, dividends reinvested but taxes paid out of pocket...today would be about 3 million and dividends of 250k per year
Love it! I’d say build up your own business, gain new associations, and be open to LEARN and GROW! 👑
Often you have no choice, but to work on hinh-stress, low-paid jobs, having no FI in your 30s or even 50s. There's not many choices out there in reality.
To me all jobs are stressful if you are not financially independent. Might as well get a decent pay and reach FI sooner than later.
I totally agree with you. It was few years ago. I was so stressed and anxious because I could lose my income any time. I decided to check all my finances and started saving/investing hard-core for five years nonstop, it was extremely hard to not travel and going out as much but now I do sleep with no worries and no longer stressed if I happen to loose my job.
I’m commenting this before watching the video but I’ve read up on Slow FI and it just seems like normal retirement to me. Am I missing something? Back when pensions existed there were a lot of people who were able to retire in their 50s. Is the difference just that the burden of saving for retirement is now the retirees or does it have to do more with intentionality within the process? Would appreciate any insight.
I think you got it exactly right.
Most financial videos just don't take kids into account. So basically, to achieve FI, don't have kid?
Of course it’s still possible if you don’t have an income issue. The principle still applies. Budget everything and save as much as you can
Are you familiar with Betterment Boss?
Great explanation!
Please make a video on how the current global slowing/stopping of economy affects the FIRE community!
I tried watching for the way world was in 2019. It's 2020. Those FIRE guys who pulled the trigger on 2019 are being slaughtered.
They can be. That's why I always prefer to focus on the FI part over the RE part. If my tenants cover my expenses, lifestyle spending AND allow me enough leftover funds to continue investing then - with an emergency - even amid a recession - I'll be fine. I imagine most of the people who are unfortunately being "slaughtered" right now were probably BARELY ready for RE (Retire Early).
Nope, the entire system of FIRE is built around a withdrawal rate that works even if there's a massive downturn right after you retire. Some of them are probably at risk, but plenty are doing just fine.
Slaughtered? Lol we are only 10% below highs now. Stock market always comes back.
Not necessarily. Part of the strategy will surely be to have enough cash to live on for a year or two before relying on withdrawals from the market, in order to protect investments.
@@sgist7824 Excellently point. It's like an emergency fund for R.E. A bit less aggressive than my preference, but a good plan all the same.
Slow FI is good like smoked BBQ or a stew cooked on the crock pot right? Low and slow.
I really enjoy and appreciate your vedio i was wondering what was your take on the magic formula and if it really works would love to see the numbers and if it still works after all this year the person name is joel greenblatt thank you for all the information you have given to the public it has helped me a lot
Dave, to be perfectly honest I haven't got around to reading Greenblatt's book on the subject, yet. I have a rough idea of what his formula's focus is, but I'd like to get a more thorough grounding in it before doing a video on the subject. I'll add it to my list of potential future video topics so I don't forget about it (I think it will go good with my investing strategies series down the road), but it will be some time before I can make a video on it. I hope you understand! Thanks for the suggestion and I'm glad to hear that the videos have helped you so far :)
@@NextLevelLife k no problem and i understand ill keep a eye out on it and thank you
You want to retire early? First step: Don't follow your local bank's investment advice! Educate yourself and prosper.
Income does matter though. Someone making 10k/yr saving 99% of income wont retire (@100k/yr) as fast as someone making 100mil/yr saving 1% of income. these are extremes but prove the point.
Inevitable yes, best no. Best is to maximize time in FI, that is more of a YOLO argument than spending today.
Let's be realistic and pragmatic. Most people will be lucky to get to LeanFire.
Where are these low stress jobs you speak of? Every job I've had felt stressful. Some just pay more
That 100k per year is all after taxes correct?
Is Slow FI another name for Coastfire?
Congrats on the 100.000th subscriber!!
Thank you!
love your vids! should have way more subscribers!
It's interesting to see how living on 30.000$ Sounds like deprivation on this video and families with children manage to save money with the same budget.
Financially independent retire eventually
🤯
This has to be Andy from marriage kids and money😂
My method is very slow F.I. 😁
I love the videos MINUS the constant drawing. ; \
🙌🏾
Same issue as the last video. You need to address the impact of inflation on the value of money at FI. I'm unsubscribing since you continue to ignore this critical point and greatly diminishing the validity of your presentations.
Let me start off by saying I'm just trying to understand and learn since I'm new to the whole financial thing. With that being said can you explain a little more of how inflation impacts someone's retirement goal
@@AnjelEYez614 30 years into the future prices for food, clothing, and other items will likely cost more due to inflation. Inflation over the last 50-100 years has averaged 3.1% per year. So costs for purchased items can be expected to increase by about 3.1% per year if you use historical data. The recent data, however suggests inflation may only be 2%. Even so, after 30 years, 2% inflation makes a $1 item into one that costs $1.80. If one extrapolates those costs into an expected yearly spend of $50K in today's dollars, that becomes $90K 30 years in the future. And conversely, 30 years from now, $50k will have the buying power of about 27.8K in todays dollars.
@Jon Hooker ooooohhhhh I see. Thank you very much for that explanation...so out of curiosity how would someone calculate that into the retirement plan
@@jonhooker8810 but retirement accounts appreciate in value at greater rates than inflation so doesnt it come out kind of equal?
@@shayslay3416 No, you are missing the point entirely. I'm talking about the impact of inflation on the buying power of your dollar in 30 years compared to today. So, saving up to cover todays costs makes no sense. You are saving for tomorrow's dollars.