The Intersection of FIRE and Disney

[bernina]

I'm curious what you (or others here) would say is a safe alternative for growth now. (Asking because we have too much just sitting in savings.)

I struggle with this as well but then decided to trust my target asset allocation mix. I keep 6-12 months of expenses in a savings account that doesn't earn much at all but is safe. It's enough to also cover minor home projects so I don't set aside extra for those. Of course if you're targeting buying a car or a home that changes things.

The rest gets invested according to my target which for us is 80% stocks (mix of domestic and international) and 20% bonds/cash. Since our emergency fund is fully funded any excess gets dumped into our taxable brokerage in VTSAX. Not "safe" by any means in the short run but it fits into our overall target. If stocks start to get too heavy in my portfolio I adjust by tweaking my 401k to be a bit more bond heavy. I don't do this frequently (once a year) and I also don't do it out of a reaction to the market. I simply adjust yearly to keep close to 80/20.

I also take advantage of checking account bonuses with my emergency fund. Lots of banks will offer a few hundred dollar bonus if you open a new account and either direct deposit to it or keep x amount in for 3-6 months. It helps the money to earn a bit more than 1% but does require some time investment.

Another thing to consider is what you're paying in interest on your mortgage (if you have one). We decided to dump excess savings into our mortgage which is 4%.Lots of thoughts on whether to invest vs pay down mortgage so read up on what makes the most sense for your situation.

 

[Sjm9911]

I'm curious what you (or others here) would say is a safe alternative for growth now. (Asking because we have too much just sitting in savings.)

Im am no means versed on this. For safe it depends on the individual. For me , safe is dividand stocks, so i chose something that is lower risk and has been paying a decent dividend. Some dont think its safe. But for me its better then betting on bitcoin. Others may place it in a fund . Me i just bought some att , basied on that it really dosent move too much up or down, i dont see it going bankrupt, and it pays a decent dividend. If it stops paying or reduces its dividend i will sell it. My idea is to have enough stocks that pay dividends to offset my retirement. I want like 2000 a month in dividends, so i can keep my equity. When i retire, i want to use this extra when i get older to curb inflation. Untill then i reinvest the dividands. This is only what i am planning, and is just that my plan. Is it good, idk. But its the best i can come up with.

 

[Sjm9911]

I struggle with this as well but then decided to trust my target asset allocation mix. I keep 6-12 months of expenses in a savings account that doesn't earn much at all but is safe. It's enough to also cover minor home projects so I don't set aside extra for those. Of course if you're targeting buying a car or a home that changes things.

The rest gets invested according to my target which for us is 80% stocks (mix of domestic and international) and 20% bonds/cash. Since our emergency fund is fully funded any excess gets dumped into our taxable brokerage in VTSAX. Not "safe" by any means in the short run but it fits into our overall target. If stocks start to get too heavy in my portfolio I adjust by tweaking my 401k to be a bit more bond heavy. I don't do this frequently (once a year) and I also don't do it out of a reaction to the market. I simply adjust yearly to keep close to 80/20.

I also take advantage of checking account bonuses with my emergency fund. Lots of banks will offer a few hundred dollar bonus if you open a new account and either direct deposit to it or keep x amount in for 3-6 months. It helps the money to earn a bit more than 1% but does require some time investment.

Another thing to consider is what you're paying in interest on your mortgage (if you have one). We decided to dump excess savings into our mortgage which is 4%.Lots of thoughts on whether to invest vs pay down mortgage so read up on what makes the most sense for your situation.

Yea, its what works for you. I just ajusted a ton of stuff, still doing so as i try not to look at stuff daily. Doing that can make you nuts...lol. I reajusted my retirement date. So in about 5 years. With that said, i bought some dividend producing stock. And added some money to the morgage each month. I looked at the kids account for collage, and will keep adding to that as i had been. I can do 5 more years at work, or more if needed. While not exactly a fire person, just a saver , my retirement age will be about 53. Give or take a year or two. I think its doable. I will still have a morgage, but the extra money added to it will take off about 14 years. Plan is to keep paying it down ( just got the house 4 years ago with a 30 year morgage.) And have it paid off by 65ish. Then I'll probably move out of NJ, that in itself will be like a big pay raise.

 

[tink89]

I think most people that are chasing FIRE are typically not using an advisor. The blunt advice you’d hear on the internet is: if you can’t do the the research and figure it out on your own, an advisor isn’t going to be the answer.

It sounds like you're in great shape. With a bit of research you'll be well on your way to maximizing your savings without having to pay fees or spend excess time (unless you're a nerd like me and end up actually enjoying all the research, even after your portfolio is set ).

Research, research, research. I am for sure always researching and reading up. I had not heard of the bogleheads forum so I will check it out and see what more I can learn.

 

[IamGroot]

Right now I am buying bitcoin and SPY calls. Just keep your ears to the ground as the democrats will very likely be going after big tech in 2021/2022, at which point the major indices will tank hard and ill be flipping over to buying puts.

 

[IamGroot]

Research, research, research. I am for sure always researching and reading up. I had not heard of the bogleheads forum so I will check it out and see what more I can learn.

My hot take is that financial advisors are a scam. The overwhelming majority of people should only be buying 2-3 big index mutual funds with extremely low expense ratios. A financial advisor will at best put your money in the same funds but take a 1-2% cut of your assets each year, or at worse put your money into mutual funds that give them big kickbacks with much higher fees (plus the 1-2% you pay them directly). Very few "advisors" actively trade for their clients, and it has been proven over and over and over and over again that they will never exceed the returns of the market.

You should max your 401k/IRA/HSA each year in those big index funds. If you arent already doing this, you dont make enough money to be investing in individual stocks or speculating in other ways.

Big index funds to explore : S&P 500 Index (big company US - low risk), US Extended Market/Small Cap (smaller US companies - slightly more risk), International (moderate risk)

If you are under the age of 60 I wouldnt put any money into bonds.

 

[SouthFayetteFan]

So for any lurkers or newbies here who think this is difficult, here are the steps to FIRE:

1) Maximize your income (without losing your sanity)
2) Minimize your expenses (without starving your family or denying yourself all enjoyment)
3) Invest the difference in a broad based mutual fund
4) Do this for 10-30 years. (This is the “boring middle” where most of us are right now). Once you have investment assets and cash that exceeds 25x your annual expenses, you are basically FI.

That’s all it takes! More income makes it easier, less income makes it harder, but anybody can FIRE if they get their annual expenses low enough.

 

[tink89]

My hot take is that financial advisors are a scam. The overwhelming majority of people should only be buying 2-3 big index mutual funds with extremely low expense ratios. A financial advisor will at best put your money in the same funds but take a 1-2% cut of your assets each year, or at worse put your money into mutual funds that give them big kickbacks with much higher fees (plus the 1-2% you pay them directly). Very few "advisors" actively trade for their clients, and it has been proven over and over and over and over again that they will never exceed the returns of the market.

You should max your 401k/IRA/HSA each year in those big index funds. If you arent already doing this, you dont make enough money to be investing in individual stocks or speculating in other ways.

Big index funds to explore : S&P 500 Index (big company US - low risk), US Extended Market/Small Cap (smaller US companies - slightly more risk), International (moderate risk)

If you are under the age of 60 I wouldnt put any money into bonds.

I am ok at finding info on my own and like doing research and check up on finances frequently. Ive read through this thread and others even thought it might not apply to me but I pick up new tips to apply to my situation. I’ve always thought the same about advisors but wasn’t sure if it was something necessary to achieve some goals.

We have definitely started contributing more to our retirement accounts and have noticed we could be contributing more. Given what we have in savings we should be maxing everything out. DH and I started out with nothing and had more in debt that in savings so I guess I’m always waiting for the other shoe to drop and want to be prepared with accesible cash. That’s were my frugality comes from too.

I have however never looked into HSA never had an FSA either. I’ll do some research.

 

[NOLA_Tink]

Just refinanced our home to a 20-year mortgage and shaved 7 years (and lots of $$$) off of our loan. I thought this group might appreciate that small win. It's just a start, but I am relieved to have a plan.

 

[dotty7200]

My husband and I are actively chasing FIRE, and he struggles with large expenditures like Disney, so I’m going to love reading back through this thread!
We are already establishing a future budget for post retirement, and one of our biggest buckets is vacation spending. We definitely have retirement priorities but don’t want to sacrifice enjoying ourselves to get there.

 

[DetroitDisney]

If we’re all being honest, FIRE and Disney aren’t actually compatible. Nobody really doing FIRE would take expensive vacations regularly.

But if we’re just talking about being passionate about personal finance and taking the steps to retire wealthy, you can absolutely fit Disney into that plan. It’s all about paying yourself first and managing your money well.

If anyone has specific questions, please let me know as I’d be happy to provide unofficial financial advice.

 

[Sjm9911]

Disney is $$$$. Is it a waste? I dont think so. I think its an experience, especially if you have kids. I want to give my kido a bit more then i had , that was about 0 vacations. Lol. So, i will spend the money, but try my best to do it on the cheap.

Yea its not compatible, but you need to live a little also. So save somewhere else to splurge at disney.

Ok, ok im just trying to convince myself here.........

 

[Mome Rath]

IMO, FIRE and Disney can indeed go together depending on income and savings rate. It was easier to fit into a plan several years ago, but gets harder as Disney raises their prices and adds on new fees.

I guess another way to look at it; can someone have financial independence and retire early and still go to Disney? Sure.

 

[cjlong88]

If we’re all being honest, FIRE and Disney aren’t actually compatible. Nobody really doing FIRE would take expensive vacations regularly.

I'm confused...what makes someone "really do FIRE"? When I listen to those who have championed FIRE, they don't deprive themselves of every little enjoyable thing. You can certainly gain financial independence, achieve early retirement, and still go to Disney. They are not mutually exclusive.

 

[DetroitDisney]

IMO, FIRE and Disney can indeed go together depending on income and savings rate. It was easier to fit into a plan several years ago, but gets harder as Disney raises their prices and adds on new fees.

I guess another way to look at it; can someone have financial independence and retire early and still go to Disney? Sure.

My point is just that FIRE is about cutting all costs going buck wild to get financial freedom to retire as soon as possible. If you take a $10k vacation before you’re retired, you are by definition not doing FIRE.

It’s perfectly fine to enjoy life, but you can’t say you’re doing FIRE.

It’s like going on a diet where you’re cutting calories but still eating carbs and saying you’re on Keto. No, you’re not on keto but you ARE on a diet.

 

[Sjm9911]

I have read the same stuff about fire, save everything and eat peanut butter for lunch every day to retire. Then get a second job after you retire to supplement the retirement. Not exactly for me. Ill save and when i retire, im retired. Ill get a job if im board, not because i need to earn. So ,im not a fire type, but im still a saving type. I think thats the diffrence. At least thats how i understood it.

 

[RamblingMad]

Disney is $$$$. Is it a waste? I dont think so. I think its an experience, especially if you have kids. I want to give my kido a bit more then i had , that was about 0 vacations. Lol. So, i will spend the money, but try my best to do it on the cheap.

WDW is ridiculously expensive if you stay on property. Also, the parks are spread out, so it's hard to do a lot each day. When I went as a kid in the 80s and 90s, this wasn't a big deal. As an adult after having gone to Disneyland, I find it super frustrating. I can do a cheap Disney weekend at Disneyland for a fraction of a WDW trip and hit the same number of rides in a fraction of the time. This is even easier if I do it for the first half of a week.

 

[DetroitDisney]

WDW is ridiculously expensive if you stay on property. Also, the parks are spread out, so it's hard to do a lot each day. When I went as a kid in the 80s and 90s, this wasn't a big deal. As an adult after having gone to Disneyland, I find it super frustrating. I can do a cheap Disney weekend at Disneyland for a fraction of a WDW trip and hit the same number of rides in a fraction of the time. This is even easier if I do it for the first half of a week.

I do love how convenient Disneyland is.

 

[piccolopat]

The goal of FIRE is to gain Financial Independence so you can Retire Early. How an individual approaches that goal can be very different. Some people want to FIRE as early in life as possible and to do so they are willing to live in a tent and eat nothing for Ramen for years. Other people want to FIRE earlier than usual and to do so they do what is needed to increase their earnings while saving as much as they can. There is no one way to FIRE and for many of us it doesn't mean total depravation of everything enjoyable, like travel, that others might consider frivolous spending. It really is all about the math. If you need "X" dollars too support "Y" spending once you retire, you can take as much or as little time as you want to get there. Since nothing in life is guaranteed, some people prefer to spend a bit more on the journey.

 

[SouthFayetteFan]

My point is just that FIRE is about cutting all costs going buck wild to get financial freedom to retire as soon as possible. If you take a $10k vacation before you’re retired, you are by definition not doing FIRE.

It’s perfectly fine to enjoy life, but you can’t say you’re doing FIRE.

It’s like going on a diet where you’re cutting calories but still eating carbs and saying you’re on Keto. No, you’re not on keto but you ARE on a diet.

I don’t think that’s how most people define FIRE.