Net Worth Update: May 2016

Happy May!  I hope April treated you well and tax day didn’t crush you like it crushed me!  Even though taxes came due, our net worth still went up $6,379.32!! I’ll take a $6K jump every month…

April Financial Breakdown

House: $383,728 – $321,484 $62,244.  I’m just using zillow.com as the baseline here.  They give their estimate for how much they think you’re home is worth.  I’m not saying it’s accurate but it’s a decent way to keep track without bringing an appraiser in every month to help you track your net worth. This month it said the value of my home went up $4,197.00.

My 401k: $18,689.37.  Right now 5% of my salary is going into my 401k via my employer. Nothing crazy here.  According to my account at personal capital, my portfolio only increased 1.79% over the course of April.

Pension Fund: $8,215.40.  I’m one of the few remaining workers in America that contribute to an employee pension fund and if I decide to stay with my employer and retire 24 years from now I will receive a pension.  I DO NOT PLAN ON DOING THIS!  I’m all about early retirement!!!

My Old 401k: $8,497.11.  This 401k is from an old employer.  I need to roll this over into a Roth IRA.  Hopefully I get to this very soon…


Wifey 401k: $4,682.47. Same situation as my 401k.  5% match from her employer.

Wifey Old 401k: $3,300. Also in the same situation as my old 401k.  We also need to roll this over to a Roth IRA very soon.

Car: $13,174.00.  Well, I don’t know what to say on this one.  According to kbb.com, the value of my car actually increased by $174 over the past month.  I won’t expect an increase on a vehicle ever again but it’s a nice surprise.

Jeep: $10,763.00.

Emergency Fund: $8,016.98.  The emergency fund took a hit this past month due to taxes.  I owed over $3k and was able to cash flow over $2k of it, but I had to dip into the emergency fund for just over $1,000 of it.

TOTAL NET WORTH: $137,582.33 (+$6,379.32)

So 2nd post of my net worth in the books.  I’m not expecting to see gains of over $6,000 for a while, especially since over $4,000 of it was due to gains on the value of my home.

Keep in mind, the first few years of beginning to build your net worth are slow but once you get some momentum it’ll shoot up faster than you can imagine!

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Motivate Yourself To Build Wealth!

Getting control of your finances, increasing your net worth, and building wealth is not an easy thing to do. It’s actually extremely difficult. It will never happen without a plan, telling your money where to go, and the dedication to follow through with your plan.

Because of this, it’s important to figure out why you want to build wealth. Think about it right now! Why do you want to build wealth? Do you have specific goals you want to accomplish? Do you want to retire early? Do you want to change your family tree? Do you want the freedom to do whatever you please? Maybe you just want some “f#ck you” money? Whatever your reason is, it is important to have that reason fresh in your mind because you’re going to need to refer back to it frequently for motivation.

debt-slave

Personally, I don’t want to be a slave to anyone. I use the word slave because I firmly believe that if anyone has control over me and can manipulate me due to my finances, that’s exactly what I am…a slave to that person, job, loan company, etc.  Currently, the only outstanding loan I have is the mortgage on my house and it’s driving me crazy.  My mortgage, although extremely affordable as a percentage of my take home pay, is stressful because if keeps me from being able to leave my job if I wanted to quit today (to see how much house you can afford, look here).  My emergency fund keeps me safe for 6 months if I lose my job but my mortgage is keeping me from being able to choose any job I want, regardless of what that job pays.

So, for me, not wanting to be a slave is my “why”, and the motivation from my why will keep me disciplined and help me achieve anything I want! Do I want to have f#ck you money? Yes. Do I want to retire early? At this time I do. Do I want to change my family tree? It will be done. Any goals I want to accomplish can become a reality, all because I have the motivation to never be a slave to anyone.


Now it’s your turn to think about why you want to build wealth.  If my reason works for you, great! Roll with it and use it to live your dream of being free and financially independent.  If my reason doesn’t resonate with you, sit down and figure out:

  1. What are your goals that you want to accomplish in life? Write this down on a piece of paper and write down whatever comes to mind.  What would you do with the rest of your life if money wasn’t an issue?
  2. How would you live if you only had 6 months to live? What kind of life would you live?  How does it compare to how you’re living now?  How would it change if you didn’t have to worry about money?
  3. What are your most important goals? While you’re reviewing the goals you’ve written down, pick out which ones are most important to you.  Will you be able to accomplish your goals without getting control of your finances?  How will your goals be affected by building wealth?  How will they be affected if you don’t change how you spend/save money?

After completing this exercise you should have an idea of what’s important to you right now and how building wealth will only aid you while trying to accomplish your dreams.  Your goals will probably change over time so you’ll want to revisit this exercise periodically so that you can adjust.

So…What’s your why?

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Do You “Act As If?”

Have you heard the saying “Act As If” before? If you’ve seen the movie “Boiler Room” I know you have.  In “Boiler Room,” Ben Affleck is training a group of wannabe stock brokers to be fantastic but illegal stock salesmen on Long Island.  I won’t ruin the story for you but I want to talk about a specific part of the movie where he’s addressing the group of trainees…

At this point in the movie all trainees have just been hired and are preparing to start selling stock after passing their series 7 exam (the SEC requires any individual who wants to sell securities pass this exam). While conducting a morning sales meeting Ben brings up the fact that many of the trainees, who are all wearing suits, aren’t wearing suits that meet their companies standards.  He told them they dress like $hit and need to go out and buy at least one decent suit because the company they work for has a “minimum level of aesthetic professionalism they need to maintain.”  He also promises the group that it’s ok to buy an expensive suit even though they’re broke because they’ll be millionaires in a short period of time.

This then led to the “Act As If” speech, which I’ve always loved. Check it out… ***Disclaimer: Ben drops the F bomb in this clip.***

This is how the typical American thinks about money.  Most of us spend our money before we’ve made it and it gets us into trouble.  Luckily, no job will require anyone to act like millionaires if they aren’t millionaires.  I understand that the point of this talk is to build confidence and present an image of success.  But, you can’t just go out and buy an expensive suit because you think it’ll make you successful faster by influencing how others think of you.  Maybe you’ll boost your confidence for a brief period of time but you’ll become financially successful by being good at your job and telling your money where you want it to go.

I’ve never gone to a doctor because he drives a $100,000 car or a lawyer because he wears a $1,500 suit.  I pick a doctor by talking to patients of his and finding out his reputation. Is he smart? Does he have a good bed side manner? Will he be able to keep me from dying if I’m not supposed to die at that particular time? My point is that if you’re good at your job, no one will care what kind of suit you’re wearing or what model car you’re driving.

Like I said, I’ve always liked the “Act As If” mantra.  It can be applied to almost any situation, not just money.  It pumps me up, it’s motivating and it makes me want to go out, kill something, and drag it back home (metaphorically).  However, now that I’ve gotten a little older and gotten control of my finances and career, I don’t agree with this message as it relates to personal finance.  “Act As If” sounds an awful lot like keeping up with the Jones’ and no one can build wealth by trying to keep up with all of the other fools who either don’t care or are ignorant about personal finance.


When I was younger, I would blow all of my money right after pay day because, like the characters in this movie believed, I thought that I would earn money so fast that I wouldn’t miss the money I already blew.  I think most young professionals feel that way in their early 20’s.  It’s hard to think about retirement when you’re just starting a working career.  But, there isn’t one person on this earth that won’t run across a difficult time in there lives. It is said that everyone will have at least 1 financial emergency every 10 years. We just can’t keep spending money and expect to make it back, or make more, right away. We have to be prepared!

Fortunately, some of us finally wake up and realize that we work too damn hard for our money and we don’t want to look up after 30 years and have nothing in the bank to show for our hard work.

Success with money and more importantly, the speed with how fast you are successful with money comes from your level of dedication and what you are willing to sacrifice. “Act As If” DOES apply to you and your money but you have to reverse how you think about this phrase. “Act As If” you’re poor. “Act As If” you only make 50, 60, 70% of what you really make. “Act As If” you’ll be working for the rest of your lives if you buy that new car or bigger house…because you actually might if you make a poor decision.

Get rich by “Acting As If…”. How will you “Act As If?”

Frugal Activities To Enjoy In The Spring!

Spring is an excellent time of year to be outside taking advantage of the sun, warmer temps, and FREE activities that nature provides.

The state park offers cabins like this to rent.
The state park offers cabins like this to rent. And, they’re right on the water.

I spent this past weekend at the lake with my family but we didn’t spend $1,000 or more on one of the fancy rental houses in the area.  I took advantage of the state park at the lake and rented a cabin with another family and split the cost.  Total cost for a trip to the lake after splitting the costs?  $160!  Not bad for a 3 day weekend.  Each family brought it’s own food so we could cook out by the fire and avoid eating at the high priced restaurants around the lake and nature provided all of the entertainment for the adults AND children.

Look at this Monster!
Look at this Monster!

The state park had miles and miles of hiking trails by the water and through the woods.  We skipped some rocks, caught a few fish, saw a ton of wildlife, and were able to get away from all of the technology that is normally part of our lives.  No T.V., no cell phone, no internet, social media or blogging.  Just fresh air and good times with family and friends.

The fun we had this past weekend got me thinking about other ways I’d like to get away on the cheap this spring and, luckily for you and I, nature provides just about all of them.  There’s no better way to enjoy a weekend after the cold, dark winter than to be out in nature getting fresh air and (for me) some much needed exercise.

  • Camping- Tent camping is the cheapest way to camp but RVs and Cabins are also decent options.
  • Kayaking– it’s great exercise and MUCH cheaper than boating.  You could pick up a decent kayak on craigslist for as little as $100.
  • Hiking- It’s free and you can easily google hiking trails wherever you live or wherever you’re vacationing.
  • Running
  • Trail riding- This could be with horses or bikes.  If you don’t already own a horse, obviously, a bike would be the more cost effective way to go.
  • Geocaching- If you prefer having a goal or a mission while you’re hiking, you could also take up geocaching.  Essentially, it’s the worlds largest treasure hunt and there are millions of “caches” all over the world.  You can check it out here.
  • Playing outdoor games with your kids-  You can teach them some outdoor games or, more likely, you can let them teach you some outdoor games.
  • Swimming in a river or lake
  • Fishing
  • Star Gazing- If you want to have your phone with you, you can always download one of the astronomy apps that points out the stars and planets as you pan your phone along the sky.
  • Hang around a camp fire with friends
  • Take up photography– You never know what types of things you’ll run across if you get out in the wild.

These frugal activities can take up most of your weekends in the spring and you’ll be healthier and more relaxed if you spend time outside and get your mind off of work and the stresses of normal life.  I only listed some of the ones that I really enjoy but there are unlimited options for cheap outdoor activities.  Use your imagination and come up with some that people may not have heard of yet.

What kind of frugal activities are you planning this spring?

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Is The Millionaire Next Door Dead?

If you watch the news these days, you may notice that a whole lot of people seem to believe that the American dream is dead. No one can get ahead and the notion of “the millionaire next door” is no longer attainable. Well, fortunately for everyone, you can still become a millionaire. The American dream is still alive and you can achieve anything you set out to achieve.  But you have to WORK hard!  No one said it was easy to be successful.  No one said you can become financially free without sacrifice.  And you sure as hell can’t rely on the government to help you out.  It’s all on you to achieve what it is you want and I wouldn’t have it any other way.

So How Do Rich People Handle Money?

millionaire lifestyle
The majority of millionaires do not live like this.

There has been study after study done on how millionaires handle money and one of the most extensive studies I’ve seen, was done by Dr. Thomas Stanley.

As Dr. Thomas Stanley, author of “The Millionaire Next Door” points out, one of the most popular chapters in his book (among millionaires) is Chapter 2, Frugal, Frugal, Frugal. This chapter details the frugal lifestyle of millionaires in terms of the modest prices paid for clothing, shoes, watches, motor vehicles, etc.  Check out the book, it’s one of my personal favorites.

Chapter 2, is essentially the most important takeaway of the entire book and it says that millionaires budget, avoid debt at all costs, and invest a lot of money.  But, they are frugal because they are content with what they have.


So How Can You Do It?

Obviously, becoming a millionaire or being financially free is not an easy feat. It takes a lot of work! It takes a lot of discipline! But it is still a possibility…look at all of my fellow personal finance bloggers, they know it can be done and they’re documenting exactly how they’re doing it! So, why not find a person you may look up to, who is successful with money and find out how they handle their money? If you handle money the same way they do, I can probably come to a conclusion that you will also be successful with money.

You can also find a financial plan that works for you and stick to it.  It doesn’t have to be difficult.  I actually prefer that it’s simple to understand because that means that it’ll be simple to follow.  My recommendations are:

  1. Create a Budget
  2. Pay off all Debt (except for your mortgage)
  3. Build up an emergency fund worth 6 months of expenses
  4. Invest in Retirement
  5. Pay Off Your House
  6. Build wealth and achieve Financial FREEDOM!!!

Why Aren’t More People Free?

Are you happy with what you have?  The answer to this question is important in knowing if you will become rich or not.  Most millionaires are content with their $20-$30 pair of jeans, used car, and modest homes.  They dont feel the need to try to impress anyone and they don’t care about what a stranger at a stoplight thinks about their car.

So, maybe the reason that people feel like getting ahead financially is a pipe dream is because they spend their days finding ways to buy convenience and focus on how they can keep up with the Jones’ instead of focusing on building wealth and increasing their net worth.  The size of your income doesn’t matter if you’re making more money AND spending more money.

90% of millionaires are first generation rich, meaning that they are self-made millionaires.  They didn’t receive inheritances.  They worked their butts off, had a plan, were disciplined with their money, avoided debt, and invested month after month, year after year.

They did it, and you can too!


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How To Reduce Your Tax Bill?

I can’t stand tax season.  I know taxes are necessary to keep the country running but the last few years I’ve owed over $2,000 every April, which got me looking for ways to knock this down to $0.  While taking a look around I’ve come to the conclusion that I can either take a job that pays much less money or I could find a way to legally reduce my taxable income.  I chose the latter for obvious reasons…

So How Do I Reduce My Taxable Income?

PayYourTaxes

You have to itemize your deductions rather than take the standard deductions in order to take advantage of these write-offs:

  • Retirement Savings: Contributions made to a 401k are tax deferred contributions which means that your taxable income will be reduced by the amount you contribute (the limit is $18,000 for 2016). You can also deduct up to $5,500 in contributions to a traditional IRA ($6,500 if you’re 50 or over. And, if you’re self-employed, you can deduct up to $52,000 (or 25% of compensation) in SEP IRA contributions for 2014.
  • Flexible Spending Account: A FSA allows an employee to set aside a portion of earnings to pay for qualified expenses as established in the employers cafeteria plan, most commonly for medical expenses but often for dependent care or other expenses. Money deducted from an employee’s pay into a FSA is not subject to payroll taxes, resulting in substantial payroll tax savings.
  • Paying for dependent care: According to IRS.gov. The dollar limit on the amount of the expenses you can use to figure the credit is $3,000 for the care of one qualifying individual or $6,000 for two or more qualifying individuals. The amount of your credit is between 20 and 35 percent of your allowable expenses. The percentage you use depends on the amount of your adjusted gross income.
  • If you’ve made certain energy-efficient home improvements: Qualified equipment includes solar hot water heaters, solar electric equipment, wind turbines and fuel cell property. Credits are worth up to 30% of the cost, with no cap. This will expire in 2016.

  • Paying for college: The American Opportunity Credit takes up to $2,500 off your tax bill per year for four years if you’ve paid eligible costs towards a post-secondary degree program.
  • Student loans: You can deduct up to $2,500 in interest, though benefits begin to phase out for joint filers with modified adjusted gross income over $120,000 ($60,000 for singles).
  • Save for your kid’s college education:  You can save up to $2,000 tax-free every year through an ESA (Education Savings Account).  This can reduce your taxable income by up to $2,000.
  • Health savings account as part of a high-deductible health insurance plan: Families with qualified plans can deduct up to $6,500 ($3,300 for singles) in contributions made to HSAs. The money can be rolled over to other years and used for a range of qualified expenses.
  • Expenses related to moving or a job search: If you moved more than 50 miles for a job within a year of starting a new job, you can deduct expenses related to the move, including mileage, lodging, moving services and supplies.
  • Mortgage Interest: You can deduct interest on your primary residence and a second home that is used primarily for personal use.
  • Points on a mortgage: If you can deduct all of the interest on your mortgage, you may be able to deduct all of the points paid on the mortgage. If your acquisition debt exceeds $1 million or your home equity debt exceeds $100,000, you cannot deduct all the interest on your mortgage and you cannot deduct all your points.
  • If you paid taxes: Odd as it seems, you can deduct certain taxes, including property tax on your primary residence, vehicles (depending on the state), and state and local income taxes.
  • If you gave money to charity: You can deduct your charitable contributions every year but make sure you save the documentation proving that you donated to a charity and how much you donated.  For those of you that tithe to a church, it also counts.

What are some ways you use to lower your tax bill?


*These are just some ideas to help you reduce your taxable income and get the most out of your deductibles.  I’d like to point out that I’m NOT a tax professional or tax attorney so please consult with one if you have any questions related to taxes.

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Net Worth Update: $131,203.01

Welcome to April everybody!  I hope March treated you well and you were able to take advantage of a market that wasn’t losing money.  The S&P 500 increased 3.98% over the last 30 days.  It wasn’t a great month for investments but at least it wasn’t like January!

Since this is my first post on my net worth updates, I’m just going to list everything out and I won’t really have any detailed explanations about what’s going on like I will in future net worth posts.  You can also see in the “My Net Worth” excel pic that there is nothing there for “last month.”  That’s because this is the first month I’ve started using it.

I’m currently not investing in any 401k’s or other investments.  I do have balances in 401k’s but the only changes in those investments are from my employers contributions and the ups and downs of the market.  Right now I’m in Step 3 and I’m just building up an emergency fund of 6 months worth of expenses.

So, here we go…

April Financial Breakdown

House: $379,531 – $322,085 $57,446.  I’m just using zillow.com as the baseline here.  They give their estimate for how much they think you’re home is worth.  I’m not saying it’s accurate but it’s a decent way to keep track without bringing an appraiser in every month to help you track your net worth.

My 401k: $17,660.16.  Right now 5% of my salary is going into my 401k via my employer.

Pension Fund: $7,975.  I’m one of the few remaining workers in America that contribute to a pension fund and if I decide to stay with my employer and retire 24 years from now I will receive a pension.  I DO NOT PLAN ON DOING THIS!  I’m all about early retirement!!!

My Old 401k: $7,991.85.  This 401k is from an old employer.  I need to roll this over into a Roth IRA.  Hopefully I get to this very soon…


Wifey 401k: $3,779. Same situation as my 401k.  5% match from her employer.

Wifey Old 401k: $3,300. Also in the same situation as my old 401k.  We also need to roll this over to a Roth IRA very soon.

Car: $13,000.  I know, I know.  Many people don’t like counting the value of vehicles towards their net worth for whatever reason they choose, but I do because I could easily sell my car and have $13,000 in cash if I needed it.

Jeep: $11,000.  Same here…

Emergency Fund: $9,051.  I’m sad to say that I do not have my 6 month emergency fund saved up yet.  But, we’re working on it and will hopefully be where we need to be in the next 6 months or so.  GOAL? $20,000 right now.

TOTAL NET WORTH: $131,203.01

So there it is.  My first post on my net worth.  It’s obviously not where I want it to be right now but when I’m done building a solid foundation I will be able to invest a lot of money and build my net worth much faster than I can right now.

The first few years of beginning to build your net worth are slow but once you get some momentum it’ll shoot up faster than you can imagine!

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How much house can you truly afford?

If you’re like me and you’re on a mission to retire early, you need to know that the choices you make always affect your timeframe for when you’ll reach early retirement.  It can shorten how long it is until you reach your goal or it can push it back further and further into the future.  How much of a house you buy will be one of the most crucial financial decisions you’ll make.

extravagant home
Why have a home like this if you have to worry about paying the mortgage for the next 30 years?

Like everything in the world, there are many different opinions when it comes to how much you should spend on housing.  There are many people who think that their house is an investment and it’s ok if they have a ridiculous mortgage payment on an extravagant home.  On the opposite end of the spectrum, there’s a large movement of individuals who lean towards keeping there expenses down to nothing which has in turn created a housing market for “tiny” houses.  Personally, I pretty much stand right in the middle.  I like to keep my expenses low but with a wife, 2 kids, and 2 dogs I can’t really force them to spend the rest of their lives in 300 square foot house.

I’ve never really liked to think of my house as an investment but I can acknowledge the fact that houses do appreciate over time.  At 3% appreciation over 30 years, a $235,000 house becomes worth $485,000.  Not too shabby, but it isn’t guaranteed and shouldn’t be relied on.


How Much Should I Spend On A House?

When figuring out how much you want to spend on a house, you want to avoid any advice from the banks.  Banks will allow you buy a house where the mortgage will be around 50% of your take home pay (and they wonder why there was a housing crisis).  If you’re spending 50% of your monthly take home pay on a house, you’re house poor ladies and gentlemen.  Personally, I’d like to see everyone keep their house payment around 25% of their take home pay when financed with a fixed rate 15 year mortgage.  At 25%, you have the ability to buy a decent house, pay off that house earlyinvest a lot of money, and have a little bit of a life.

House-PoorWouldn’t it be great if you owned a home that you could afford AND pay off early?  Doing it this way will allow you to not only invest more money in retirement but you’ll also have a possible appreciating asset ready to sell if you desire.  If it doesn’t appreciate?  You won’t have to worry about it because you don’t owe a dime on it.  I’ve never seen a bank foreclose on a house that doesn’t have a mortgage!

Most of house poor America is barely able to pay their mortgage because they received terrible advice from somewhere and significantly overpaid.  They invest less than 5% of their income, drive cars with car payments, eat out constantly, and spend every dime they receive.  Please don’t be like everyone else!  Don’t mess up the biggest financial decision you’ll make by over paying for a house.  It’s easy to get house fever while you’re walking around with a real estate agent.  Be patient, be disciplined, and remember to sleep on any decision you’re thinking about.  Your financial freedom is depending on it!

Remember, 25% of your take home pay on a fixed rate, 15 year mortgage!

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Escape The Rat Race With Early Retirement

Why is it that whenever I talk to anyone about retiring early, they look at me a little cross eyed and either shrug it off by not really responding because they don’t believe it can be done, or they ask me, “Wouldn’t you get bored?  What would you do if you retire?”

I can understand when people look at me like I’m crazy for thinking I can shorten my working years down to 15 years.  It’s extremely difficult to pull off and it’s hard enough to even get people to behave with their money, budget, and stay out of debt, let alone start an early retirement movement.  But I don’t understand why people would ask, “wouldn’t you get bored?”  Would you really stay in the rat race because “you might get bored?”  Do you know how bored I am working in the same office everyday?  I also have the same commute, same desk, and same type of work…EVERYDAY!!!  Early retirement seems like heaven when you look at it this way.  I don’t know about you, but I have a lot of things I want to accomplish in this life, and I feel like work just get’s in the way of that.  Sit down and think about what you would do if you didn’t have to work for money.  Dreaming is the first step in making it a reality!

day dreaming
Day Dreaming Just Let’s You Know Where You Really Want To Be. Early Retirement Will Help You Get There Faster!

The general perception of a normal retirement is that you’re now 65 or older and you’re just trying to organize the remaining years of your life so that you can be comfortable and have a little fun with the time you have left on earth (harsh but true).  But what if you could “retire” in your 30’s, 40’s or 50’s?  You could potentially have 50, 60, or maybe even 70 years to live life however you want!

As you can see, early retirement means that you have enough money to choose how you want to live your life and spend  your days!  If you just wanted to be lazy, sleep in and sit on the couch all day?  I guess you could do that, but I don’t recommend it.  If you wanted to pursue your passions and do something that is productive but excites you?  Do it, you have that freedom.

My hope is that I can reach millions of people and make them understand that early retirement isn’t impossible and that it isn’t about living a boring life.  Early retirement sets you free from being chained to your job! Early retirement IS financial freedom.  I really can’t imagine a better scenario for anyone than being able to choose how they want to live their lives!

Action-Changes-Things-AcronymIf you’re now like me, and convinced that the 65 and older “retirement” sucks, you have to TAKE ACTION NOW!  You have to pay off your debt, save money, invest, and not spend every cent of your working wages that you bring home.  The less you spend and the more you save/invest, the earlier you will be able to retire.

No one says that you need to listen to all of the conventional retirement advice and wait another 20, 30, 40 years until you retire.  Nerdwallet.com says that the average savings rate for families in America is just under 5%.  At 5%, you probably won’t even be able to retire at 65!  And, for the younger generations (millennials), what if you don’t even get social security?  You’ll be working until it’s not physically possible anymore.

If you’re ok with that type of life, I understand.  It’s easy and doesn’t require any kind of thoughtful planning or sacrifice.  But I can’t live that way.  I have a hard enough time going to work every morning and I can’t imagine doing it for more than a few years.  I’d rather save the most money I can and live the rest of my life writing a blog, trying to become a professional golfer, hunting, or working a job that I’m passionate about even if it doesn’t pay a lot of money.  I just want to be in charge of my future!

And that’s simply what I want you to takeaway from this post.  You can take control of your life!  Take control RIGHT NOW and don’t let anyone get in your way!

**If you like talking about Money, Paying Off Debt, Building Your Net Worth and Retiring Early…This is the place for you!  Subscribe to receive emails of new blog posts, news, tips, and exclusive content!!!

 

Find Money In Your Budget

Making a budget is critical to staying on track with your finances over the course of the month but it’s also a fantastic way to find extra money by cutting expenses in areas where you noticed you are spending much more than you thought.  For example, when I first started budgeting and keeping track of my expenses, I had no idea how much money I was spending going out to eat.  Can you believe that one month I had spent over $600 in restaurants?  Insane!  The budget allowed me to consciously cut back where I thought I was out of control.  Check out these easy areas you too can save some money…

Cut Back on Eating Out

Don’t do what I did.  Spending $600 a month to eat out is not only ridiculous because it’s $600 but it’s also not nearly as healthy as eating at home.  If you have any debt whatsoever you’ll want to cut this number down to $0 until the debt is paid off, but if you are debt free and have your 6 month emergency fund saved up you can give yourself a little room to live it up.  How much should you spend eating out?  That’s up to you and what kind of goals you have.  Personally, I never spend more than $200 eating out over the course of a month now that I’ve finally come to my senses (but this is still higher than I’d like).

Cancel Your TV Service

No-TV-This one is difficult for many of us because TV has become such a huge habit, but it really does hurt you in many ways.  First, it hits you in your wallet.  I had very popular satellite service that was charging me almost $200 per month because I had every channel you could imagine.  That’s $24,000 every 10 years.  If you invested that $200 per month into a good mutual fund averaging 8% interest, you’d have just over $37,000.

But the monthly payment isn’t the only problem with TV.  Getting bombarded by advertising for hours on end gets you thinking about spending money on items that you would probably never think to buy.

If you need something, you can get use Netflix, Hulu, Amazon Prime or any other streaming service for around $8 per month.

Lose The Overpriced Cell Phone

Republic-Wireless-new-logoThere are many options outside of the “big 3” phone companies (AT&T, Verizon, and Sprint).  Why pay at least $150 per month for 2 cell phone lines?  Personally, I use republic wireless and I couldn’t be happier.  I get unlimited phone, text, and 2 Gigs worth of data and the phone is configured to have everything run through your WiFi when you’re around it.  Last month, I paid $40 for both of the phones I have.

Work Out At Home

garage gymCut the gym costs by working out at home and it’ll save you the money that you hand over to them every month.  There’s plenty for you to do around the house.  Body weight exercises, running, walking, etc… Or you could set up a garage gym!  It doesn’t have to be anything expensive, you could buy everything you need off of craigslist and you may even be able to find it for free.

Cut Transportation Costs

This is actually for personal use...
This is actually for personal use…

It costs a lot of money to get around these days.  Cut expenses by selling your gas guzzling truck/SUV and buy a practical car that gets around 40 miles per gallon.  You could also try car pooling, using public transportation, or riding a bike to work.

Get Creative

Look for ways to cut hidden costs all over your budget.  For example, you could:

  1. Shop around for better deals on car and home insurance
  2. Compare health insurance plans and see if you can save money by switching to a plan with lower premiums that will still give you the coverage you need.
  3. Save money on your electric bill by following the advice of your provider on becoming more energy efficient.  This could lower your costs significantly.  They probably have a list of things to help you on their website.
  4. Replace all of the light bulbs in your house with energy efficient LED light bulbs.  They last for 20 years and reduce the use of energy dramatically.

Now get to work on that budget!  If you are able to run through this list and save money in all of these areas, you’ll be saving lots of money every month.

How much were you able to save?  Let me know in the comment section below!

**If you like talking about Money, Paying Off Debt, Building Your Net Worth and Retiring Early…This is the place for you!  Subscribe to receive emails of new blog posts!!!