Sin #1: Holding cash in a retirement account. This one always breaks my heart when I see it from a new investor. Here’s how it goes. You’re young and finally get a job making some money. You keep hearing this funny phrase “Roth IRA”. You know it’s something you probably are going to wish you […]
Fees are these tricky little guys. They hide all over the place, then can erode half of the value of your investment. These two charts show the devastating effect of fees compounded over many years of investment. On the left is a typical index fund with a very low expense ratio of 0.04%. Compounded […]
I wouldn’t call this an “optimal” investing plan. Notably, Valerie and Valentino decided to invest in a joint brokerage account, not individual Roth IRAs. Maybe it was the hopeless romantics in them, wanting their money to commingle. They knew that Roth IRAs, by law, are individual accounts. If they had chosen to invest in Roth […]
Remember retirement isn’t an age. It’s an amount of money. Once your investments have grown to 25 times your annual spending, you are financially independent and can live off your investments forever! And on the flip side, nothing magical happens at 65 that allows you to stop working. If you don’t have your money invested […]
Let me paint you a picture. You have plans to go out to a nice dinner. So you find yourself a hot date, grab a crisp $100 bill, and head for your local Red Lobster. Your date is cool, so he knows that the hundo has to cover the whole dinner. So you order an […]
They’re the wise words of wisdom every budding narcotics entrepreneur will happily share: “Don’t get high on your own supply.” Why? Because if you smoke your own product, you can’t sell it! Then you don’t make any money. That’s business 101. While that lesson seems obvious to drug dealers, many of us make the exact […]
This is the first in a series of “how to get rich” where I show you how to get rich in different places or with different items. This is how to get rich in a nutshell. Next will be in a house, then with a mouse. Then I’ll do in a box, with a fox, […]
This is a true story of a lotto winner in England! Obviously it’s an extreme example in his windfall, spending, and downfall, but I think all of us can fall victim to a similar mentality. This idea that success or happiness with money is just the next raise or windfall away. When when that money […]
In my post yesterday I mentioned how the “safe withdrawal rate” is 4% and I’m living on less than 2% of my investments. I got some questions about it, so here’s the answer! Once you have enough money invested, you can live off of those investments forever without needing any new income! When you’ve […]
When I’ve posted about all the expenses related to owning your primary home in the past, I get a lot of comments like “but what if you buy it as an investment?!” or “but what about house hacking?!”. And that’s a good point. As far as investment returns go, owning your primary home is day […]
