If you're new here, this blog will give you the tools to become financially independent in 5 years on a median salary. The wiki page gives a good summary of the principles of the strategy. The key to success is to run your personal finances much like a business, thinking about assets and inventory and focusing on efficiency and value for money. Not just any business but a business that's flexible, agile, and adaptable. Conversely most consumers run their personal finances like an inflexible money-losing anti-business always in danger of losing their jobs.
Here's almost a thousand online journals from people, who are following the ERE strategy tailored to their particular situation (age, children, location, education, goals, ...). Increasing their savings from the usual 5-15% of their income to tens of thousands of dollars each year or typically 40-80% of their income, many accumulate six-figure net-worths within a few years.
Since everybody's situation is different (age, education, location, children, goals, ...) I suggest only spending a brief moment on this blog, which can be thought of as my personal journal, before looking for the crowd's wisdom for your particular situation in the forum journals.
Before you vote, you may want to watch this 30 minute I.O.U.S.A. clip on youtube. History shows (think Soviet Union for a recent example) that the wrong fiscal policy can be as almost as destructive to the general welfare of the population as conventional war.
Here is an article to the main candidates’ position on the deficit.
The US is a global economic (and militaristic) player and the choice of its leadership impacts the whole world. If nothing else, you owe it to the many non-Americans that truly wish they could vote in the US elections, so go vote already!
I’m tired of being blamed for a low personal savings rate.
p.s. How is “disposable income” defined?
Trug said,
If you mean USSR fiscal policy was wrong and made “right” by letting oligarchs and those in power steal state assets – I disagree. General welfare of the population declined after USSR fell apart.
Jacob said,
@poor boomer – as far as I remember disposable income is what you get out of your paycheck AFTER taxes and 401ks. I’m an not 100% sure, but I don’t think 401ks are counted into the savings rate and that always puzzled me.
@Trug – I’m not saying it was made right. The problem in the US is that the government is promising European style welfare for the old people while at the same time promising US tax levels. It’s impossible to have both at the same time, especially with a growing number of old people. The easiest/most euitable solution would simply be to scale out the retirement age so it becomes more aligned with the longevity of people in 2040 instead of the longevity of people in 1940.
AlexK said,
You are right about the welfare probelm Jacob. I just voted for McCain because of Obama’s socialist leanings.
Debbie M said,
I don’t really get this entry. First you have a long video about how huge our deficit is and how that’s not easily fixed. Then you have a link to an article that says neither of the two major candidates are even trying to fix it. How does this help us figure out how to vote?
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