As Didi says in the novel (Findependence Day), “There’s no point climbing the Tower of Wealth when you’re still mired in the basement of debt.” If you owe credit-card debt still charging an usurous 20% per annum, forget about building wealth: focus on eliminating that debt. And once done, focus on paying off your mortgage. As Theo says in the novel, “The foundation of financial independence is a paid-for house.”
I start with Die with Zero because it most directly deals with the topic of money as we age. In fact, as most retirees know, one of the biggest fears behind the whole retirement saving concept is running out of money before you run out of life.
But it appears that many of us have become so fixated with saving for retirement, we may end up wasting much of our precious life energy, and being the proverbial richest inhabitant of the cemetery. For you super savers out there, this book may be an eye opener, as is the other book, 4,000 Weeks.
As I note in the column, this genre of personal finance started with Die Broke, by Stephen Pollan and Mark Levine, which I read shortly after it was first published in 1998. That’s where I encountered the amusing quip that “The last check you write should be to your undertaker … and it should bounce.”
The premise is similar in both books: there are trade-offs between time, money and health. Indeed, as you can see from the cover shot above, its subtitle is Getting all you can from your money and your life. As with another influential book, Your Money or Your Life, we exchange our time and life energy for money, which can therefore be viewed as a form of stored life energy. So if you die with lots of money, you’ve in effect “wasted” some of your precious life energy. Similarly, if you encounter mobility issues or other afflictions in your 70s or 80s, you may not be able to travel and engage in many activities that you may have thought you had been “saving up” for.
A treatise on Life’s Brevity and appreciating the moment
Amazon.com
The companion book is Four Thousand Weeks : Time Management for Mortals, by Oliver Burkeman. If you haven’t already guessed, 4,000 weeks is roughly the number of weeks someone will live if they reach age 77 [77 years multiplied by 52 equals 4,004.] Even the oldest person on record, Jeanne Calment, lived only 6,400 weeks, having died at age 122.
I actually enjoyed this book more than Die with Zero. It’s more philosophical and amusing in spots. Some of the more intriguing chapters are “Becoming a better procrastinator” and “Cosmic Insignificance Therapy.” I underlined way too many passages to flag here but here’s a sample from the former chapter: “The core challenge of managing our limited time isn’t about how to get everything done – that’s never going to happen – but how to decide most wisely what not to do … we need to learn to get better at procrastinating.”
It may not seem like it, but owning and driving a car will be a major part of your financial picture throughout your adult life. As with all financial aspects, it pays to be a smart and savvy decision-maker and shopper and to know how to save money on car expenses.
Adobe stock image: Syda Productions
By Dan Coconate
Special to Financial Independence Hub
Cars, believe it or not, are considered an asset. However, it’s good to remember that cars are indeed a depreciating asset. Every year, they decline in value due to wear and tear and also due to the release of newer models. As a result, cars are not a smart investment since they only hold value for a short amount of time.
So be wise about your cars. Making sound financial choices about the cars you drive, and the car insurance you obtain, will equal more money in your pocket in the long run.
First, let’s take a look at some tips on how to save money when you are buying a car. If you’re aiming for a stress-free and independent retirement phase, you’ll love these unique strategies to reduce your car expenses and save money.
Transitioning to early retirement is an exciting chapter that requires a smart approach to manage your finances. Car expenses are significant parts of any driver’s budget, and you can actually save money with a few strategic adjustments. Here are some unique strategies to reduce your car expenses and save money for more pressing needs.
Negotiate with your Insurance Company
One of the most effective ways to reduce car expenses is to negotiate with your insurance company. Many people assume their premiums are non-negotiable, but that’s not true.
By contacting your insurance provider and discussing your current rates, you might find opportunities for discounts or better rates. Highlight your clean driving record or inquire about senior discounts.
Consider Bundling Car Insurance with other Policies
Insurance companies often offer discounts to customers who bundle multiple policies. If you have homeowner’s or renter’s insurance, consider combining it with your car insurance.
This strategy will simplify your payments and provide a discount on your premiums. The savings from bundling can add up over time, helping you reduce your car expenses and invest more in your retirement savings!
Take a Defensive Driving Course
Defensive driving courses are excellent for lowering your insurance premiums. Many insurance companies offer discounts to drivers who have taken these courses. Completing a course shows your insurer that you’re committed to safe driving practices.
Lower your Driving Speed
Driving at low speeds can reduce your car’s fuel consumption. When you maintain a moderate speed, your engine works more efficiently, conserving fuel and reducing wear and tear. Small fuel savings can add up over time, making a noticeable difference in your car-related expenses. Continue Reading…
Welcome to another Then and Now post, a continuation of my series where I revisit some older blogposts and either rip them to shreds (because my thinking has totally changed on such subjects) or I’ll confirm my position on various personal finance topics or specific stock and ETF investments.
Back in 2015 when the original post was shared, I referenced this quote that frames my own portfolio management approach when it comes to my bias to owning stocks over bonds:
“If you want to make the most money, you should invest in stocks. But if you want to keep the money you made in stocks, you should invest in bonds.” – Paul Merriman.
Bonds are essentially parachutes when equity markets fall; bonds will cushion the portfolio landing. And equity markets can fail big at times!
While I understand there are different ways to measure the “equity risk premium,” the summary IMO is the same: the risk premium is the measure of the additional return that investors demand or expect for taking on a particular kind of risk, relative to some alternative.
Buy a bond and hold it until it matures and you know what you will get back.
Invest in equities and the range of outcomes is wide.
With equities, you could make a lot of money, but you could lose a lot.
Equities have to have a higher expected return to compensate investors for taking on this risk.
Otherwise, if the risk premium is not there – why bother with stocks at all?
Now – on bonds
That’s the rub these days, for many investors. Why invest in stocks when interest rates are higher and you can earn 4-5% essentially risk-free?
Of course, there is no way of knowing how equities or bonds will perform until returns for each happen. You can consider rebalancing your portfolio from time to time between stocks and bonds because you expect equities will do better longer-term but that doesn’t mean they will short-term.
Which brings me back to this: risk is the price of the entry ticket to buy and hold stocks. Continue Reading…
In the quest for Financial Independence, milestones vary from mastering debt to embracing minimalism.
We’ve gathered insights from nine professionals, including Finance Experts and Founders, to share their personal triumphs. Discover how these individuals have navigated their paths from mastering debt through frugality to paying off mortgages independently.
Mastering Debt through Frugality
Achieving Total Debt Freedom
Securing a Higher-Paying Job
Early Retirement through Real Estate
Eliminating Debt with Side Hustles
Embracing a Debt-Free Minimalist Life
Regulating Finances with Nervous System
Strategically Paying off Student Loans
Paying Off Mortgage Independently
Mastering Debt through Frugality
Each milestone marked an important stage towards a more confident future on this road to Financial Independence. One turning point occurred when I became a master of managing Debt and adopted frugality as my way of life.
Although, in my pursuit of financial freedom, it dawned on me that Debt was both a burden and a tool; this happened at the time when I decided to confront my debts openly. Eventually, I divided them by interest rates and then talked with lenders about much better repayment terms. With discipline and focus, little by little, I got rid of a mountain of debts while coming closer to financial liberty after each payment.
Another significant landmark was when I began practicing frugality. For instance, being mindful of small savings that accumulate over time into significant wealth-creation opportunities has been one key lesson that I learned from this approach. In other words, I dissected every expense into what need was involved for its necessity or want and became good at finding creative ways to save without losing sight of the quality of life.
Whether it is meal planning or relying on loyalty programs or DIY solutions; being frugal does not mean living without but instead making conscious decisions towards personal financial objectives.
Whenever I look back on the path that led me toward my financial independence, I don’t see these checkpoints as just what they are; instead, I think of them as turning points in how I think and act. Learning how to manage debt properly and adopting a saving lifestyle have given me complete autonomy over my financial future, thus laying down a foundation for abundance and stability. –– Arifful Islam, Finance Expert, Sterlinx Global LTD
Achieving Total Debt Freedom
One of the biggest milestones on my journey to Financial Independence was finally becoming 100% debt-free. This achievement felt especially meaningful because it required a serious commitment to smart money management and embracing a frugal lifestyle.
Early in my career, I was weighed down by a ton of student loans and racked up credit-card balances. I realized all that debt was just holding me back from reaching my bigger financial goals and living the life I really wanted. So, I made a decision to make paying it all off as fast as possible my top priority.
I started by creating a super-detailed budget that accounted for every dollar of income and expenses. Then I looked for any areas where I could cut back on non-essential splurging: like eating out, entertainment, shopping sprees, etc. Any money I could free up got funneled directly towards making bigger debt payments, focusing on the highest-interest accounts first.
At the same time, I fully embraced a more frugal, minimalist lifestyle overall. I learned to appreciate simple, free pleasures and find joy in experiences over buying a bunch of material stuff. I also hustled to increase my income through side gigs like freelancing or selling unwanted items.
Through diligent budgeting, living frugally, and a strategic debt repayment plan, I managed to become 100% debt-free within just a few years. Not only did it drastically improve my overall financial situation, but it gave me this incredible sense of freedom and control over my life. It laid the foundation for even bigger money wins down the road while teaching me the value of living below my means to prioritize long-term goals. –– Loretta Kilday, DebtCC Spokesperson, Debt Consolidation Care
Securing a Higher-Paying Job
The most critical milestone I reached was getting a job that paid more than just “enough.” I’ve tried freelancing, selling online, starting a website, doing social media, and I even tried digital marketing for a startup. But it wasn’t until I got a plain old job that just paid more than I needed that I found everything I needed: peace of mind, freedom from debt, the start of a retirement fund, and more.
For anyone who’s struggling even $50 makes the difference between starving or surviving: I suggest just building your skills and portfolio and moving up to better-paying jobs. Get the certainty and security that comes from a regular salary, one that allows you to pay all your bills and gives you breathing space.
Once that’s done, you have the room to plan for the future, to pay off debt, to organize your finances so that if you want to budget, it’s actually possible. — Debashri Dutta, Founder, Dmdutta.com
Early Retirement through Real Estate
Being able to retire in my early Thirties was a significant milestone toward Financial Independence. I started investing in real estate in my twenties, and I had to work two jobs and live frugally to afford a down payment.
But today? I don’t have to worry about working a job I’m not particularly passionate about. Instead, I can spend my time doing what matters more to me, like coaching others who want to escape the rat race and build financial security for themselves.
Bottom line: If you have a goal in mind, short-term sacrifices will be worth it in the long run. — Ryan Chaw, Founder and Real Estate Investor, Newbie Real Estate Investing
Eliminating Debt with Side Hustles
I gained Financial Independence through hard work and side hustles. The biggest milestone I achieved was paying off US$60,000 in student loans. That debt was debilitating, and I was able to pay it all off by devoting all the money I made from side hustles to debt reduction. After I paid off my student loans, I used the same methods to pay off the house.
The next milestone that was incredibly important to me was having US$250,000 in savings. That milestone was important because it felt like the investment income began to snowball. It also felt like my hard work was paying off, and it made it easier to make the effort to save money after that point because I felt it working. — Jonathan Geserick, Managing Attorney, Texas Probate Pros
Embracing a Debt-Free Minimalist Life
I had a business go very south about 10-15 years ago. I held on way too long because it was “my baby.” Because of this, I racked up a lot of debt that I really knew I shouldn’t have, trying to save the business.
I moved that debt into a very low-interest situation long ago, which allowed me to pay a very small amount towards the principal and interest every month. That was a great solution; however, I recently decided to just pay the whole thing off. Continue Reading…
Life can get hectic, and sometimes special occasions sneak up on us faster than expected. Whether it’s a friend’s birthday, a colleague’s promotion, or a last-minute holiday party invitation, forgetting a gift can leave you scrambling. But fear not! With a little creativity and resourcefulness, you can still find the perfect present, even if you’re on a tight deadline.
This guide explores nine fantastic last-minute gift ideas suitable for any occasion, from birthdays and holidays to anniversaries and graduations. These options cater to various tastes and budgets, ensuring you can find something thoughtful and memorable, even with limited time.
1.) Hand-painted portraits
A unique and personalized present, a hand-painted portrait captures the essence of your loved one. You can commission a portrait based on a favourite photo, featuring their pet, or showcasing a cherished memory. While some artists might require a significant lead time, many online platforms offer expedited services where you can receive a digital file within a few days. This digital file can be printed on canvas, framed, or used to create a variety of personalized gifts like mugs, phone cases, or tote bags.
2.) Audiobooks
Audiobooks are the gift of knowledge and entertainment, making them perfect for busy individuals who enjoy listening while commuting, exercising, or doing chores. Consider the recipient’s interests when choosing an audiobook. Do they love historical fiction? Perhaps a captivating biography or a classic novel they haven’t read yet would be ideal. For mystery lovers, a suspenseful thriller could be a great choice. Many online audiobook retailers offer instant downloads or gift memberships, making them a convenient last-minute option.
3.) Colourful Wall Art
A vibrant piece of art can instantly transform a space, adding personality and a touch of joy. Explore online art marketplaces or local galleries (if time permits) to find unique prints or paintings that suit your recipient’s taste. Abstract art offers a conversation starter, while landscapes or floral prints can add a touch of serenity.
Pro-Tip: Consider the recipient’s home decor style when choosing the artwork.
4.) Cheesecake and Rose Bouquet
Who can resist the delightful combination of a delicious cheesecake and a beautiful bouquet of roses? Many online bakeries and gourmet shops offer gift sets featuring decadent cheesecakes paired with stunning floral arrangements. This decadent indulgence is ideal for birthdays, anniversaries, or simply to show someone you care.
5.) Create a Video Tribute
For a sentimental and heart-warming gift, put together a video montage celebrating your relationship with the recipient. Gather photos and videos from throughout your time together, add some heartfelt music, and maybe even record a personalized message. Continue Reading…
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