Living the life you want without becoming a burden to your family in retirement is the main goal to reach financial independence.
The Steps to Financial Independence are listed on this page, otherwise read more about Financial Independence in the articles listed below.
Greetings from the sea! As I mentioned in my last article, my wife and I were preparing for a cruise! Well, the preparing is over and we are cruising! All I can see is the ocean. It is beautiful and breathtaking. Something that I have never experienced in my life. Sure, I like to travel, but I have never taken the opportunity to go on a cruise. Well, here I am and it gave me an idea. I am pretty lucky to be a teacher. I may not make as much as the next guy and I may work long hours every week, but there are times that the teacher life is pretty cool.
Sometimes in life things tend to connect and it really is amazing to see the connection of items as you go through life. I know there are times when I am going through something or thinking about something and the message that week at church is connected directly.
Goals, plans and new years resolutions. Those are the things that people do each year in anticipation for a brand new year. They’re going to make changes for the better. They’re going to start working out or losing weight. They’re going to buy a new home or pay a crazy amount of the mortgage off this year. Most new year’s resolutions are short term and only really focus on one year. It makes sense to focus on a small timeframe to make things attainable. However, I have never been a big new year’s resolution fan, as most people don’t follow through with their resolutions.
What is FI? This is the term that my wife and I have been pursuing since day one as a married couple. We have been pursuing the point in our life where we have enough saved that our money is making more money than we are making at our jobs. This is the point at which you have enough money. You no longer need to earn anymore money. To some people this may sound like retirement. This is so much more than retirement. The old definition of retirement is the idea that you have to leave your job at a certain time in your life. That’s not FI. FI is not the idea of slaving away at a job for 30 years and then retiring.
Sometimes it's amazing to think that we have owned a home for 3 years. Not only is it amazing to think that we didn't have any kids just 3 years ago. It is amazing at how things can change. Since the purchase of our home, we have had two kids. It has been an amazing three years, so let's dig into the numbers!
Two weeks ago as I was working on some articles for the website, I stumbled on an interesting article about social security. The article was titled, "Millennials and Retirement: How Bad is It?" by Alicia H. Munnell on Politico's website. The article dug into the numbers of savings for retirement. The data that they shared was from a study conducted by the U.S Board of Governors of the Federal Reserve System, titled, "Survey of Consumer Finances, 1983-2016." In the article, they shared the following graph.
Some people believe that all millionaires are crooks and only have their millions because they inherited their wealth. According to Thomas Stanley, author of "The Millionaire Next Door," 80% to 86% of the millionaires in America are self-made millionaires. Self-made millionaires are first generation millionaires, which means that they were the first in their family to reach a million dollars. That means that they did it on their own. That means that you can do it on your own also.
My life is completely shaped by the fact that I grew up in a small town of less than 2,000 people and I went to a school that had one building for K-12 grade (my class was the last class to attend all years of their schooling in the same building). My life experience is different than somebody who grew up in the city and attended five different schools for K-12. I propose we change the question a little bit. What would the conversation sound like if we asked a slightly different question? This is not a question you have with a brand new acquaintance, but a discussion you have with a significant other or an accountability partner.
I can imagine driving on that mountain road. I can imagine the sound of the gravel under my tires. I can imagine crawling up the incline. Despite the slow speed, we still make that climb. We are more than happy to make that slow climb, because we know that an amazing view awaits us at the top.
As we enter into the homestretch of 2017, its time to update everyone on our spending percentages from the last three months. Despite our monthly updates on "buying nothing new," I am still posting our spending rate, because the spending rate articles focus on reaching a savings goal.
Early last week, I stumbled onto a post from Adventure Rich about the FIRE Prowess Gauge and their results. Their article was the seventh in a chain of 19 articles (the last I checked) from financial bloggers. This gauge has swept across the blogging community and I immediately calculated our FIRE Prowess Gauge.
Two summers ago, my wife and I were jumping into home ownership for the first time. We hit the ground running and started to tackle our mortgage. We have always had a goal of paying off the mortgage early and used this mindset to make extra payments on our mortgage.
Last year, we were on fire and paid off a lot of our mortgage. I am going to recap where we stood last August, then we will move into the year 2 mortgage update. By August of 2016, we had made 12 mortgage payments, plus multiple extra principal payments.
I recall my journey to launching Summit of Coin. It was December 2014 and I was listening to a podcast. The podcast was an interview of Mr. Money Mustache. This sent me down a journey of reading every article that MMM had written and peaked my interest in writing a blog detailing our journey to financial independence or as I like to call the Financial Summit. Being a teacher, I waited until summer to prep ten articles for the blog and develop the website. After a month of prep, I officially launched this blog on July 13, 2015.
Earlier this week, I was listening to a podcast and the conversation on the podcast got me thinking. I have heard a certain statement time and time again. I have heard it from my pastor, my father and even the people I listen to on podcasts. They all have stated at one point: "The stock market is at its highest value in history." A lot of times this is said with the idea that the value of the stock market is a bad thing. And I will admit, there is no guarantee in the value of the stock market. It flucuates over time and it will go down, but will the fall be that bad?
Families struggling with finances was the topic of the Fed's latest report of 'Economic Well-Being of American Households.' There was some alarming data reported and Tyler Durden, an author at Zero Hedge, did a nice break down of data in his article on the site.One stat in particular jumped out to me. The Fed Reported "44% of the Americans surveyed don't have $400 cash for emergencies."
Lately, I haven't been watching the news, because it can get so dang negative. Political parties fighting over their points of view. People angry because the political landscape is not what they want. People complaining about Trump did this, and Trump did that.
Every year, my wife and I discuss our old cars. We look at our savings, we look at how much a new car costs and the yearly expenses to keep the old car. Every time I look at this data, I always draw the same conclusion. In the long run, I am better off keeping the old car. Whether you decide to keep an old car or buy a new car, you must understand that a car is going to be a money pit. It will need gas, it will need repairs, it will even need to be washed and there is no way to avoid these extra costs.
We are 12 days removed from the end of the holiday season. We are 12 days from the beginning of a new year. This is the perfect time to make a change. This is a perfect time to start preparing for retirement. This is the perfect time to stop expecting things to start taking control of your own life. This is the perfect time to start saving more money.
This past summer, I worked summer school at one of the high schools in my school district. Just like at my school, there was an opportunity to get a free meal from a financial advisor. I normally avoid the teachers lounge on these days, because I like to avoid the awkward conversations. This time, I was interested to hear what they had to say. I took this as an opportunity to listen to the message and report back to my readers. Plus, I was interested to learn more about TRS.
We are one week into the election of Donald Trump as the President of the United States. There were plenty of theories on what would happen to the market if Trump was elected, and these theories mainly projected a Brexit like dip. I was even hoping for this outcome. I love to buy, when the market is on sale. When the market dropped after the Brexit vote, I invested $1,000 in the market and I have earned a good chunk of money on that one decision.
I found this picture and knew it just fit this time of the year. Fall is my favorite season of the year, because it involves some of my favorite things to do. With Football season and the build up to the holidays, what is there not to love? I love at how the weather changes from summer to fall. Living in Texas, the summers can be pretty hot, but the fall weather in Texas is beautiful. I have enjoyed many fall days outside in the cooler temperatures this year. Along with the cooler temperatures, comes a change in the color of the trees. The leaves fall and the vibrant reds, yellows and oranges fill the horizons. This is probably one of the things that I miss the most about living in Nebraska. We don't get the full seasons in south Texas, and my only opportunities to see the weather change is to visit the Northern States.
As a husband and soon-to-be-father, I worry about certain things. I worry about reaching the financial summit, so my wife and I can be financially secure. I worry about a safe delivery for my wife and my future child. I worry about whether they would be okay, when I am gone (And by this I mean financially). I know that losing a loved-one is very difficult, but with money problems it can become even more difficult. I don't want my wife to have to worry about money, if I happen to die early.
The idea and reason for the name of this website is the goal of reaching the financial summit. This idea came about from thinking about hiking in the mountains. Hiking is one of my favorite things to do, but does not happen very often, because Houston doesn't have much of an elevation change. Therefore, I have to go on trips to visit and hike different regions across the United States. There is something about being in nature that calms your soul. There is something about trudging through the country side to eventually reach the top of the mountain. This can take hours and sometimes days, but it is worth the reward of the view from the top of the mountain. You might even get to sit down and enjoy a snack or a sandwich as you relish the view from the top.
Becoming a millionaire has always seemed like an impossible feat for someone growing up in middle america striving to become a teacher. I had never thought about even reaching one million dollars. I didn't even know it was possible. Most people in this boat, (maybe you are one of them) don't believe that becoming a millionaire is possible. If this is you, then let me be the first (or the tenth or the thirtieth person whichever it is) to tell you:
Over a year ago, I wrote the fourth article in this series. I have been avoiding the fifth step, because there have been lots of other articles to write and I wanted to experience what it felt like to pay off the house early. I haven't reached this point yet, but we have done a lot in over a year. We have paid down over $25,000 in principal on our house and we are working towards paying off our house early.
Last year, I was celebrating the fact that we were debt free in early August. By the middle of August, we had officially purchased a house and were once again in debt. I don't necessarily believe that everybody needs to take out a mortgage to buy a house, but it is the one debt that I accept. It can be okay to take out a mortgage, because a house is an investment. Now, this doesn't mean that you should go and put yourself into 30 years of debt. I am personally a fan of the 15-year mortgage, because I prefer to get debt out of my life as fast as possible. Due to this belief, my wife and I took out a 15-year mortgage and have been making extra principal payments.
I think that this can go to show you that millennials can get a bad wrap, most of the time. All generations have entitled and lazy people. It just seems like the millennial generation has been hit with story after story of entitled lazy brats. I would say that lots of research shows that these news articles can be false, especially after Ramsey Solutions just released their results on Millennials and retirement.
This article is the fourth part in a four part series of articles reviewing, The Legacy Journey by Dave Ramsey. This article talks about Chapters 8 and 9.
I am sure that we all remember the children's story called the "The Tortoise and the Hair." This story has always been one of my favorites, because it is the true underdog story. That's like Coastal Carolina winning the College Baseball Championship. Coastal Carolina has never won a Championship in any sport prior to winning this one. The school's first National Championship in any sport was earned in 2016.
This past week I was reading an article by Milllennial Money Man (M$M) about Patience. He used a great personal story about how some months there is lots of growth with his blog and some months, there is no growth. He also says that he has some articles that are a hit and some articles that are a flop. He used a great example of how people can get bogged down on trying to make a quick buck. They try those late night infomercials and all they get is run into the mud. So based on this article, I want to pose a question. How can we continue to strive for something, if we don't see the reward?