The Intersection of FIRE and Disney

[Sjm9911]

Awesome! I’ll check it out.

Lots say to ajust it so the goverment dosen't keep your money. I don't care that much. I get a bit back usally and then it goes for vacations, new car , house upgrades, or into stocks. If i got an extra 250 a pay i can easily see using it for other stuff. It also alowes me to have some liquid cash. So while its not the best idea, its better for me to not have to pay. And im not good at projecting stuff.

 

[Sjm9911]

Yep. Super interesting.

Did you read about brokerages not allowing people to buy new positions certain equities?

Yea, its a sort of nightmare. But im still rooting for them to sure up my cruise lines or any other air line, i don't have american. It does now make sense why tesla is so high. I dont get it. Someone will get burned at the high end. So, the stock gets run up, smart people sell. I get the hedge funds get crushed ( whos money is that? Hopefully not peoples retirement stuff) and whoever bought at like the halfway pount to the top gets hurt also. Game stop went from almost blockbuster type bankruptcy to one of the top 500 companies in the world. But they still have no buisness. I wouldn't want to get stuck going in on the high end. And its down now, about half off its high.

Yea, they shouldn't block trades. Thats a mess also.

 

[AlohaNow]

I get the hedge funds get crushed ( whos money is that? Hopefully not peoples retirement stuff) and whoever bought at like the halfway point to the top gets hurt also.

One needs to be an 'accredited investor' in order to get into hedge fund stuff. The SEC sets the definition for that term. The vast majority of regular folks in the US do not qualify to get into hedge fund stuff.

 

[Sjm9911]

One needs to be an 'accredited investor' in order to get into hedge fund stuff. The SEC sets the definition for that term. The vast majority of regular folks in the US do not qualify to get into hedge fund stuff.

I get that ,but if you have a pension or have stock in a group, they might invest in hedge funds. So, while we can't buy it individually , we certainly can be vested in them.

 

[Castlequeen5]

I’m came across this thread in the beginning of January, and it’s taken me most of the month to read all 86 pages. But I’m finally finished. I’ve never heard of FIRE until this thread, and now I’m completely inspired to make better financial decisions.

I’m a teacher raising 5 kids on my own. I’m in my 40s and I take care of my mom. Several years ago I sold my house in the city, to move out to the country with my parents. It’s a big property acreage wise, but the house itself was smaller than mine and had lots of problems. My plan was to add on to the house and help my parents as they were having a hard time with upkeep of the property. My dad passed away, before I could get started. But I finally took out a home loan to fix the place up and add very much needed space. I just closed on the mortgage last fall.

So here I am now wanting to FIRE. Maybe not retire completely, but have some freedom to change jobs. My state requires 6% go into teacher retirement and I also contribute to a 403b. I’m currently putting in 9%. I only know that because I figured it out after reading this thread. Actually I didn’t know much of anything, until I started looking up all these terms I frequently see in these posts.

My plan is to up my my 403b to 15% and I just opened up...like this week, a regular Roth IRA. I want to start maxing it out each year, when I can. I feel like I’m late to the party on that one, but I guess late is better than never. And right now, I’ve just about convinced myself that it’s more important to get my vehicle paid off before I do anything else. So that will be my primary focus first, since I don’t have any CC debt. Most of you seem knowledgeable and serious about saving money, so I welcome any advice.

 

[Starport Seven-Five]

My plan is to up my my 403b to 15% and I just opened up...like this week, a regular Roth IRA. I want to start maxing it out each year, when I can. I feel like I’m late to the party on that one, but I guess late is better than never. And right now, I’ve just about convinced myself that it’s more important to get my vehicle paid off before I do anything else. So that will be my primary focus first, since I don’t have any CC debt. Most of you seem knowledgeable and serious about saving money, so I welcome any advice.

Welcome and good to hear this has been positively impacting you.

Only thing I would ask is what is the interest rate on this loan? If sub 4%, I would consider investing instead of paying off early. That % is kind of a personal decision though based on how risk (or risk adverse) you are.

 

[Castlequeen5]

Welcome and good to hear this has been positively impacting you.

Only thing I would ask is what is the interest rate on this loan? If sub 4%, I would consider investing instead of paying off early. That % is kind of a personal decision though based on how risk (or risk adverse) you are.

Sounds like something to think about. I’m still running numbers to see what my options are.

 

[bernina]

I'd be interested to hear thoughts on this.

We aim to max out our Roth's each year. We've always just taken the yearly max and had 1/12th taken from our bank accounts each month.

If we have the cash now, should we dump it in and just get it in the market sooner rather than later (we put it all in VTSAX)? I'm definitely not a market timer, and dollar cost averaging always was the autopilot way to get our money in. Just had a thought today as I was balancing accounts if maybe this is something I should consider.

We'll still be doing our monthly (bi-weekly for DH) 401k and mega backdoor which are much larger amounts than our Roth's. So maybe it doesn't really matter. Curious to hear how folks here handle Roth contribution frequency.

 

[QueenIsabella]

I'd be interested to hear thoughts on this.

We aim to max out our Roth's each year. We've always just taken the yearly max and had 1/12th taken from our bank accounts each month.

If we have the cash now, should we dump it in and just get it in the market sooner rather than later (we put it all in VTSAX)? I'm definitely not a market timer, and dollar cost averaging always was the autopilot way to get our money in. Just had a thought today as I was balancing accounts if maybe this is something I should consider.

We'll still be doing our monthly (bi-weekly for DH) 401k and mega backdoor which are much larger amounts than our Roth's. So maybe it doesn't really matter. Curious to hear how folks here handle Roth contribution frequency.

This is the sort of stuff they debate on Bogleheads endlessly! It's right up there with "do I pay off my low-interest mortgage" and "do I take out RMDs at the beginning or the end of the year". The good news is, there's no wrong answer. DH and I aren't actively investing more towards retirement, but he does contribute to his 401k, up to the company match, because--free money. Our DD25 is launched, and I encourage her to invest windfalls 50/50 in her Roth. For example, a generous great-uncle died last year, and left her ~$10k. I suggested she put half in the Roth, whenever the money is released, and put the other half aside because her car is 16 years old, and she'll likely need a newer one. sooner rather than later. She also has a pension and a 403b (I think), through her work. But I'm trying to get her to see the value of "painless investing".

 

[Mome Rath]

I think several of these questions become not just a financial consideration, but a philosophical (even religious) one, which then makes them hard to answer with a black or white approach. I'm one who doesn't like debt, any debt; therefore, I'd always prefer a paid off car (or house) or whatever vs. carrying any debt regardless of interest rate. Dave Ramsey asks a good mental question; if you had a fully paid off house or car would you borrow money against it to invest in the market? If you wouldn't do that, then pay it off.

As for how much to put in an actual retirement account, you have to balance that with FIRE plans if you have any. You want to put sufficient money away to get tax benefits, but you also want accessible money if you really want to RE. In short, you want to put enough in your retirement accounts to maximize tax benefits while not stuffing them too full of money you can't get to if you decide to retire when you are 48. If you are aiming just for FI, that changes things because you'll be working longer and won't need as much money accessible prior to retirement.

I've seen different reasons when it comes to choosing between lump-summing it vs. dollar cost averaging; time in market is better than timing the market (according to bogleheads), so lump-sum dumping is the statistical winner, but DCA-ing it in can be better for one's mental health. So, again, it's kind of up to the individual to figure out how you operate; do you feel better following stats, or your own gut feeling? I find myself doing a mix of both. lol

 

[Starport Seven-Five]

I think several of these questions become not just a financial consideration, but a philosophical (even religious) one, which then makes them hard to answer with a black or white approach. I'm one who doesn't like debt, any debt; therefore, I'd always prefer a paid off car (or house) or whatever vs. carrying any debt regardless of interest rate. Dave Ramsey asks a good mental question; if you had a fully paid off house or car would you borrow money against it to invest in the market? If you wouldn't do that, then pay it off.

Funny part is I did a cash out refi this year and put those funds in the market. Thanks Dave Ramsey for showing me a new option!

Mathematically, these questions are easy. They only get difficult when emotions get involved. Everyone has to do what allows them to sleep at night but I wish more would get a bit outside their comfort zone because far too often I see emotional justifications for plans that are less than optimal.

As for how much to put in an actual retirement account, you have to balance that with FIRE plans if you have any. You want to put sufficient money away to get tax benefits, but you also want accessible money if you really want to RE. In short, you want to put enough in your retirement accounts to maximize tax benefits while not stuffing them too full of money you can't get to if you decide to retire when you are 48. If you are aiming just for FI, that changes things because you'll be working longer and won't need as much money accessible prior to retirement.

You can access 401k funds without penalty through a few methods before age 59.5:
https://www.madfientist.com/how-to-access-retirement-funds-early/
It's important to have a plan, but early retirement doesn't require abandoning the pre-tax options.

 

[Mome Rath]

As I said, you should use your retirement accounts as long as there are tax benefits; however, you need a balance of funds outside of those options for everyday living during FIRE (there are indeed ways you can withdraw the money without penalty early but involves specific cases, and in some instances the funds still aren't available for years). Everyone's financial pictures are so different, including current income level, tax brackets, future tax brackets, etc... that each person needs to look into what is best for them in a given year.

Mathematics/statistics isn't the driving force in many lives; whether good or bad is up for debate. I'm in the mental health field, and am also a religious person, so I understand the very real psychological forces that sway people (and can be used in one's advantage), and I also support specific Christian approaches to money management that changes advice given. Again, it's a personal choice.

 

[TarraLee]

On DCA vs lump sum— we decided to keep the monthly withdrawals up to the tax advantaged point/max. If we had that “extra” in the checking, I’m sure it would find places to go. Now, we only have to make decisions about topping off or second level goals on lumps, which aren’t as often. I don’t really believe in market timing, but could see I might want to do the whole year’s amounts at once if we hit a big dip, like last March.

 

[platamama]

Funny part is I did a cash out refi this year and put those funds in the market.

That's what I'm in the process of doing right now, except I expect those funds to go eventually towards college costs. I figure I need to make 0.9% annually on that money in order to break even on the refi, and I think that's doable.

 

[bernina]

I'd be interested to hear thoughts on this.

We aim to max out our Roth's each year. We've always just taken the yearly max and had 1/12th taken from our bank accounts each month.

If we have the cash now, should we dump it in and just get it in the market sooner rather than later (we put it all in VTSAX)? I'm definitely not a market timer, and dollar cost averaging always was the autopilot way to get our money in. Just had a thought today as I was balancing accounts if maybe this is something I should consider.

We'll still be doing our monthly (bi-weekly for DH) 401k and mega backdoor which are much larger amounts than our Roth's. So maybe it doesn't really matter. Curious to hear how folks here handle Roth contribution frequency.

I ended up moving our full yearly max into our Trad IRAs and once that clears I'll roll into our Roth's (backdoor). This way I'll have one less step each month and hopefully time in market will come out ahead of moving during a high/low each month.

The rest of our contributions are spread much more evenly throughout the year via 401ks, HSA, and my additional roth contributions via mega backdoor, so I probably spent too much time thinking this through

 

[RamblingMad]

Finally broke two commas with 20 more years to go. Hopefully, I can FI soon. I just need to pay off this house, which I refinanced at 2.8%, so I'm in no rush at the moment.

 

[QueenIsabella]

I hear you on the mortgage thing. I told DH, I want the mortgage paid off before he retires. It could be the week before, I just don't want to have to worry about it once we've retired. Like you, we have a low interest rate, so I'm not in any rush. He's 8-10 years from his planned retirement (we're FI, but DH is one of those weirdos who likes his job, so no RE in our house).

 

[RamblingMad]

I hear you on the mortgage thing. I told DH, I want the mortgage paid off before he retires. It could be the week before, I just don't want to have to worry about it once we've retired. Like you, we have a low interest rate, so I'm not in any rush. He's 8-10 years from his planned retirement (we're FI, but DH is one of those weirdos who likes his job, so no RE in our house).

If I have the house paid off, I can hit my FI number within a year or two. If I don't have it paid off, I can hit it with a mortgage in about 6 years with a super low expected future return.

Mentally, I want to be FI and continue to work because I want to, not because I have to.

 

[FreeDiningFanatic]

I am reading “The Simple Path to Wealth”by JL Collins and it is so straightforward and easy to understand.

And I have to say, he has reframed how I think about spending. I’ve always been a good saver. But here’s how to think about spending vs investing that might blow your mind:

Let’s say I opt to go to dinner with my husband and spend $100 (post-COVID). If instead I opted to invest that same $100, and allow it to grow for the next 27 years, that same $100 could be worth $1300. Knowing that, would I ask my husband if he wants to go out for a $1300 dinner tonight?????

Maybe $100 is an extreme for dinner for those on this forum, but multiplying any spend by 13 (your multiple will be different) really makes me ask myself if I want it badly enough. Could be $5.

Thinking about the lost opportunity cost through this lens has totally shifted how I think about spending.

 

[SouthFayetteFan]

JL Collins is so awesome! He’s the voice of that video on the stock market I shared earlier this year here. I’ll have to go find it and quote it. It’s Awesome!

EDIT: man I could just listen to this guy talk all day!