Comments on: How I became financially independent in 5 years - Part IV - the investments http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html Financial independence, frugality, self-sufficiency, ecology, capitalism, and voluntary simplicity Fri, 21 Nov 2008 20:53:28 +0000 http://wordpress.org/?v=2.6.3 By: Anonoymous http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-1900 Anonoymous Fri, 29 Aug 2008 17:17:18 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-1900 Given your situation if is possible to live on 30% of your income-easily What advice you have for someone with debt and is married with 3 children? Had you had children you will have needed bigger space and more necesseties Given your situation if is possible to live on 30% of your income-easily

What advice you have for someone with debt and is married with 3 children?

Had you had children you will have needed bigger space and more necesseties

]]> By: Jacob http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-552 Jacob Tue, 26 Feb 2008 15:38:13 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-552 @future millionaire - compound interest destroys the simple approximation. You have to use a financial calculator that handles annuities (it has the symbols PV, FV, PMT, n and i on it) to for longer periods (or higher interest rates or lower savings rates). Alternatively you can find annuity calculators on the net. @future millionaire - compound interest destroys the simple approximation. You have to use a financial calculator that handles annuities (it has the symbols PV, FV, PMT, n and i on it) to for longer periods (or higher interest rates or lower savings rates). Alternatively you can find annuity calculators on the net.

]]> By: Future Millionaire http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-547 Future Millionaire Tue, 26 Feb 2008 14:03:17 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-547 Hey Jacob, I just found your blog and love it! Being a math person, I immediately grabbed my calculator and used your formula for time to financial independent to get mine with a savings rate of 40% and got 37.5 years but then I checked on using the standard 15% savings rate since its supposed to be only 25 years but I'm struggling here to obtain the same results. "The standard recommended 15% savings rate results in 25 years." I'm getting something more like 141 years. Am I doing something wrong? Thanks! Hey Jacob,

I just found your blog and love it! Being a math person, I immediately grabbed my calculator and used your formula for time to financial independent to get mine with a savings rate of 40% and got 37.5 years but then I checked on using the standard 15% savings rate since its supposed to be only 25 years but I’m struggling here to obtain the same results. “The standard recommended 15% savings rate results in 25 years.” I’m getting something more like 141 years. Am I doing something wrong?

Thanks!

]]> By: Steve Austin http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-415 Steve Austin Sat, 16 Feb 2008 23:44:38 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-415 Another good investment book is by David Dreman, Contrarian Investment Strategies: The Next Generation. Another good investment book is by David Dreman, Contrarian Investment Strategies: The Next Generation.

]]> By: MossySF http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-394 MossySF Wed, 13 Feb 2008 18:37:24 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-394 Yes, I've been buying lotsa REIT and value indexes. Mostly with new money but some with my TIPS allocation that has zoomed up in the last 6 months due to the flight-to-quality. Yes, I’ve been buying lotsa REIT and value indexes. Mostly with new money but some with my TIPS allocation that has zoomed up in the last 6 months due to the flight-to-quality.

]]> By: Jacob http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-380 Jacob Tue, 12 Feb 2008 01:21:31 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-380 @ debbie m - one thing I find even more fun is that people go crazy when they win $10,000 on a game show considering it's about the same amount I use for a single stock position. Though I must admit placing the trade does get my pulse up a bit. @ kristin - once I got FI the tenacity towards saving definitely took a hit and I got into a "I don't need to save anymore, and since I have a job I can spend more freely"-mode. I'm getting back on track again though. @ thrifty canadian - Ignoring the TV helps a lot :-) @ mossysf - So I guess you're in banking and housing right now? @ benjamin - it's the price we pay for weeks of the almost uninterrupted joy of daily albeit smaller gains. @ betsy teutsch - I used to derive a lot (maybe all) of my sense of identity from my work and in retrospect I have been naively idealistic. In some sense I am probably still playing with the very real danger of burning out. However, I have started diversifying my sense of [life-]purpose so instead of putting all my eggs (identity) in the scientific basket, I now try to think of myself as a scientist and a blogger and an investor. FI has certainly helped put things in perspective since I have been forced to acknowledge that I really have the choice to do what I want rather than having to live up to certain expectations. @ debbie m - one thing I find even more fun is that people go crazy when they win $10,000 on a game show considering it’s about the same amount I use for a single stock position. Though I must admit placing the trade does get my pulse up a bit.

@ kristin - once I got FI the tenacity towards saving definitely took a hit and I got into a “I don’t need to save anymore, and since I have a job I can spend more freely”-mode. I’m getting back on track again though.

@ thrifty canadian - Ignoring the TV helps a lot :-)

@ mossysf - So I guess you’re in banking and housing right now?

@ benjamin - it’s the price we pay for weeks of the almost uninterrupted joy of daily albeit smaller gains.

@ betsy teutsch - I used to derive a lot (maybe all) of my sense of identity from my work and in retrospect I have been naively idealistic. In some sense I am probably still playing with the very real danger of burning out. However, I have started diversifying my sense of [life-]purpose so instead of putting all my eggs (identity) in the scientific basket, I now try to think of myself as a scientist and a blogger and an investor. FI has certainly helped put things in perspective since I have been forced to acknowledge that I really have the choice to do what I want rather than having to live up to certain expectations.

]]> By: betsy teutsch - MoneyChangesThings http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-377 betsy teutsch - MoneyChangesThings Mon, 11 Feb 2008 01:05:25 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-377 I love your story. It isn't easily replicable because most people are not as able to assimilate so much investing information - your science/number skills are being put to excellent use. Also most people are not willing to be as drastically frugal and self-disciplined as you are, even though their extra spending probably adds as much stress as pleasure to their quality of life. Opting not to have children is also an atypical behavior, though certainly one that is good not just for your bottom line, but for the planet's as well. As a person who maintains a day job, it is odd when my portfolio makes more than I do. But I derive many other benefits from working than the $. I like what I do. Once the novelty of your financial security/prosperity wears off, I predict that you will feel some need to do something more fulfilling in the world. Going up the Maslow scale, people seek meaning from increasingly transcendent connection - spiritual and communal. That's what my blog is all about. What's on the other side of surplus and abundance? Being financially secure is a means to an end, not an end in itself. Nice that you're young and have a good long while to figure it out! I love your story. It isn’t easily replicable because most people are not as able to assimilate so much investing information - your science/number skills are being put to excellent use. Also most people are not willing to be as drastically frugal and self-disciplined as you are, even though their extra spending probably adds as much stress as pleasure to their quality of life.
Opting not to have children is also an atypical behavior, though certainly one that is good not just for your bottom line, but for the planet’s as well.
As a person who maintains a day job, it is odd when my portfolio makes more than I do. But I derive many other benefits from working than the $. I like what I do.
Once the novelty of your financial security/prosperity wears off, I predict that you will feel some need to do something more fulfilling in the world. Going up the Maslow scale, people seek meaning from increasingly transcendent connection - spiritual and communal. That’s what my blog is all about. What’s on the other side of surplus and abundance? Being financially secure is a means to an end, not an end in itself. Nice that you’re young and have a good long while to figure it out!

]]> By: Benjamin http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-374 Benjamin Sun, 10 Feb 2008 21:39:26 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-374 Hahaha. I definitely know what it's like to become inured to the daily fluctuations of the market. It's still disappointing when you watch your portfolio lose 5 figures in a week. While on this topic, I need to thank you for reminding me of something I already knew, namely that as the market goes down, it creates real opportunities for increasing assets at a fraction of the cost of a bull market. I was getting really depressed until I remembered I still had some money squirreled away in a savings account and decided that owning something at a decent price would be a pretty spectacular deal. Plus the schadenfreude of laughing at all the people who are simply exacerbating the process and continuing to sell by the ton... Hahaha. I definitely know what it’s like to become inured to the daily fluctuations of the market. It’s still disappointing when you watch your portfolio lose 5 figures in a week.

While on this topic, I need to thank you for reminding me of something I already knew, namely that as the market goes down, it creates real opportunities for increasing assets at a fraction of the cost of a bull market. I was getting really depressed until I remembered I still had some money squirreled away in a savings account and decided that owning something at a decent price would be a pretty spectacular deal. Plus the schadenfreude of laughing at all the people who are simply exacerbating the process and continuing to sell by the ton…

]]> By: MossySF http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-373 MossySF Sun, 10 Feb 2008 21:26:22 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-373 I 75% believe in index funds and 25% believe in value investing. So instead of picking specific stocks or specific managers, I tend to pick sector/style indexes. The stuff that is dropping the most, I direct my new contributions to. Will this work? Well I'll find out in a few decades. :) I 75% believe in index funds and 25% believe in value investing. So instead of picking specific stocks or specific managers, I tend to pick sector/style indexes. The stuff that is dropping the most, I direct my new contributions to. Will this work? Well I’ll find out in a few decades. :)

]]> By: Thrifty Canadian http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-372 Thrifty Canadian Sun, 10 Feb 2008 20:54:43 +0000 http://earlyretirementextreme.com/2008/02/how-i-became-financially-independent-in-5-years-part-iv-the-investments.html#comment-372 You're saying it's possible to maintain a challenging day time job and doing all this investing learning/research while keep married? The time saved from shopping is truly tremendously huge... You’re saying it’s possible to maintain a challenging day time job and doing all this investing learning/research while keep married? The time saved from shopping is truly tremendously huge…

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