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The RETIREMENT thread
- Thread starter Leongsam
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
How I Retired at 30
By Farnoosh Torabi | Yahoo! Finance – Mon, Jul 22, 2013 3:18 PM EDT
Meet Mr. Money Mustache. Hundreds of thousands of readers follow his bold advice on his self-titled blog — and for good reason. He has cracked the retirement code while many of us were struggling with student loans. At 23 years old he began working and saving…and saving some more. By age 30, he’d amassed some $800,000 in cash and investments, and then entered early retirement.
How, exactly? I flew to his home in Longmont, Colorado, where the now 38-year-old lives with Mrs. Money Mustache and Mustache Junior, for the scoop.
The Rule of 70%
While a popular rule of thumb is to try to save 10% of your income every month, in the race to retirement Mr. Money Mustache saved and invested close to 70% of each paycheck until he had about $800,000 racked up. At that point he felt comfortable quitting his job, as the dividends from his stock portfolio and income from a rental property were finally enough to support his family’s lifestyle. “I just figured based on a 4% withdrawal rate of your savings, if you have $800,000 saved, you could draw an income of $32,000 a year from that. Our needs are less than that, so we actually don’t need $800,000 in savings.”
Live Simply
But wait. How does the family live on less than $30,000 a year with a child? “It’s by cutting out stuff, the invisible stuff, that’s most expensive. I kept the headline items, like a house, trip to Australia and good friends and good food, but I cut out stuff like spending $50 on coffee a week or having a brand new car every few years,” he says. “We do a lot of stuff ourselves. We go to parks. We do music together. We ride our bikes, go to the library. Kids love it. Costs almost nothing to do.”
Treat Debt Like Your Hair Is on Fire
We should mention that Mr. Money Mustache graduated without any student loans. He never really had any credit card debt and advises his readers, who aim to retire early like him, to treat debt like a scary emergency, as if their hair is literally on fire. “If you have credit card debt, you don’t make little payments on it. You don’t go to the movies and put $10 on the credit card. You stay home, you earn as much money as possible, you eat the cheapest food possible and get that emergency solved,” he says.
Location Matters
The Mustaches intentionally live in a town with a relatively low cost of living. Their property taxes in Longmont are only $200 per month, and the home’s solar design and insulation keep energy bills to under $40 per month.
Who Needs a Car?
Longmont is also a bike-friendly town, which encourages even more saving. By biking to most places, Mr. Money Mustache figures it helps the family save roughly $10,000 a year on transportation costs. “I kind of have a rule: You do not drive the car for trips within the city, because you don’t need to. The bike will do it just as fast, and it’ll be better for you,” he says.
Could you follow in Mr. Money Mustache's financial footsteps? Connect with me on Twitter @Farnoosh and use the hashtag #finfit.
How I Retired at 30
By Farnoosh Torabi | Yahoo! Finance – Mon, Jul 22, 2013 3:18 PM EDT
Meet Mr. Money Mustache. Hundreds of thousands of readers follow his bold advice on his self-titled blog — and for good reason. He has cracked the retirement code while many of us were struggling with student loans. At 23 years old he began working and saving…and saving some more. By age 30, he’d amassed some $800,000 in cash and investments, and then entered early retirement.
How, exactly? I flew to his home in Longmont, Colorado, where the now 38-year-old lives with Mrs. Money Mustache and Mustache Junior, for the scoop.
The Rule of 70%
While a popular rule of thumb is to try to save 10% of your income every month, in the race to retirement Mr. Money Mustache saved and invested close to 70% of each paycheck until he had about $800,000 racked up. At that point he felt comfortable quitting his job, as the dividends from his stock portfolio and income from a rental property were finally enough to support his family’s lifestyle. “I just figured based on a 4% withdrawal rate of your savings, if you have $800,000 saved, you could draw an income of $32,000 a year from that. Our needs are less than that, so we actually don’t need $800,000 in savings.”
Live Simply
But wait. How does the family live on less than $30,000 a year with a child? “It’s by cutting out stuff, the invisible stuff, that’s most expensive. I kept the headline items, like a house, trip to Australia and good friends and good food, but I cut out stuff like spending $50 on coffee a week or having a brand new car every few years,” he says. “We do a lot of stuff ourselves. We go to parks. We do music together. We ride our bikes, go to the library. Kids love it. Costs almost nothing to do.”
Treat Debt Like Your Hair Is on Fire
We should mention that Mr. Money Mustache graduated without any student loans. He never really had any credit card debt and advises his readers, who aim to retire early like him, to treat debt like a scary emergency, as if their hair is literally on fire. “If you have credit card debt, you don’t make little payments on it. You don’t go to the movies and put $10 on the credit card. You stay home, you earn as much money as possible, you eat the cheapest food possible and get that emergency solved,” he says.
Location Matters
The Mustaches intentionally live in a town with a relatively low cost of living. Their property taxes in Longmont are only $200 per month, and the home’s solar design and insulation keep energy bills to under $40 per month.
Who Needs a Car?
Longmont is also a bike-friendly town, which encourages even more saving. By biking to most places, Mr. Money Mustache figures it helps the family save roughly $10,000 a year on transportation costs. “I kind of have a rule: You do not drive the car for trips within the city, because you don’t need to. The bike will do it just as fast, and it’ll be better for you,” he says.
Could you follow in Mr. Money Mustache's financial footsteps? Connect with me on Twitter @Farnoosh and use the hashtag #finfit.
Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
My stock investments is giving me a passive income of at least $50,000 a year in the form of dividens. I don't really need so much because I live modestly. So I have a surplus & what I do is re-invest into the stock market.
Planning on renting or buying a place in a cheaper neighbourhood like Thailand. The lower costs will allow me to continue re-investing. I doubt that I will have to touch my principal & when I up the lorry, will probably have enough $ to pass on to my relatives.
My stock investments is giving me a passive income of at least $50,000 a year in the form of dividens. I don't really need so much because I live modestly. So I have a surplus & what I do is re-invest into the stock market.
Planning on renting or buying a place in a cheaper neighbourhood like Thailand. The lower costs will allow me to continue re-investing. I doubt that I will have to touch my principal & when I up the lorry, will probably have enough $ to pass on to my relatives.
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
Agree,
I used my dividends to feed my horses carrots and apples and also vet charges every month !:o
Agree,
I used my dividends to feed my horses carrots and apples and also vet charges every month !:o
Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
Don't forget to take some of the carrots & apples yourself. Go for the organic ones. They are a good source of nutrition & you don't want to scrimp on your number 1 asset, your health
Don't forget to take some of the carrots & apples yourself. Go for the organic ones. They are a good source of nutrition & you don't want to scrimp on your number 1 asset, your health
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
Funny thing about both carrots and apples, imho, they taste much better cooked than raw. :p
Don't forget to take some of the carrots & apples yourself. Go for the organic ones. They are a good source of nutrition & you don't want to scrimp on your number 1 asset, your health
Funny thing about both carrots and apples, imho, they taste much better cooked than raw. :p
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
Agree.
Like that pokok boleh juiced lagi at our vintage !:o
Agree.
Like that pokok boleh juiced lagi at our vintage !:o
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
Retirement equals learn new things !
Retirement equals learn new things !
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
hic hic ....
hic hic ....
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
Yeah, just stay drunk and you'll forget about your CPF.
hic hic ....
Yeah, just stay drunk and you'll forget about your CPF.
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
Relaxing at patio ... ..... looking at pond filled with green moss !
Hehe .... now still boozing !
Relaxing at patio ...
..... looking at pond filled with green moss !
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Re: dedicated to Leongsam: 4 Things Rich People Should Stop Saying
are siow fei or siow tien with you? :o
Relaxing at patio ...
are siow fei or siow tien with you? :o
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Yup in oz tennants r protected by the tenancy act. Basically if the tenant is late for rent etc very hard to get rid of them. Damages r hard to claim and so on. Tat y landlords have become damn picky n some shun property investments due to unfair laws. Tat also explain y Perth vacancy rates r low as there is a shortage of rental property. But this has sort of stabilised. Anyway in oz have to know the law well to protect yrself. Learn to play n game the system.
My uncle did that & that's why he was able to make $$$$$$
However being a landlord is not always that great when one is dealing with Australians:(
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Retirement is the time when you start playing hop skotch again !:o
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u oso start praying polis n thieves again ...Retirement is the time when you start playing hop skotch again !:o
cuffs r used! ...
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u oso start praying polis n thieves again ...
cuffs r used! ...
Gajah Muda,
Hop skotch better lah !
I hop, she skotch. She hop, I skotch !:p
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At our vintage, we must actively seek out all fresh nom yais to bury our head in between !:o
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