Category Archives: Financial Independence

When Lisa first learned about the financial independence, retire early (FIRE) movement she was stunned that so many people, often younger than her, could possibly save enough to retire. Reading the blogs and first-person stories invigorated her. She wanted to follow suit. It changed the way she and her husband spent money. They cut out restaurants, wore old clothes and avoided coffee shops, funneling all the extra cash into paying down debt and building retirement funds.

It really did motivate us, Lisa said.

But as someone who has worked in the pharmaceutical industry for a number of years, she never had a huge problem with her job. The more Lisa saved, though, the more she felt annoyed at going to work. The more she saved, the more she wanted to watch HGTV before bed. The more she saved, the more she couldnt understand why she should walk around in a coat with holes in it simply to prove that she was good with money.

Lisa and her husband abandoned their early retirement plans after realizing it isn't what they ... [+] wanted.

The whole effort made me unhappy, said Lisa, who asked to only use her first name since shes still working full-time. Thats why, four years after starting her FIRE goal of retiring young, Lisa and her husband decided to abandon the retire early portion of their savings plan. Instead, shes decided to focus on financial independence, but also not worry if they want to eat out on a Friday night.

Theres a fine line between frugality and feeling guilty over every dime that you spend in order to save a little bit more. Those that enter FIRE often ignore that line during the accumulation phase, saving as much as possible without regard to how it makes them feel today while sometimes sacrificing their health or well being. But its not a feat for everyone. For Lisa, this excessive frugality only became a hindrance to life.

It doesnt mean shes giving up saving. Or now, suddenly, going to rack up credit card debt. Instead, Lisa, who blogs about her experience at Mad Money Monster, is reevaluating her life again, figuring out what to keep and what to ignore when it comes to her financial independence (FI) strategy.

Abandoning Her Great Health Care Wasnt An Option

As they saved, one factor that grew increasingly concerning was the health and welfare of her mom. My mother depends on us for help for basic living expenses, Lisa said. She expects to care for her mother as she grows older. While Lisa was making strides paying back debt under the FIRE plan, she had to spend $2,000 on her mothers dental expenses.

Usually that cost comes out of pocket, and they expect to have to do the same with vision care and some other wellness needs.

This unknown complicated their financial picture. But also Lisa sees her moms situation, and then recognizes her luck with her current health care plan, which she describes as really good. The idea that she would walk away from that plan, simply so she could retire early shes about 60% of the way to her original FIRE mark she now views as selfish. And shes not comfortable with some of the other options out there for health care coverage, including the public markets or health shares.

For me to walk away from that [healthcare] would be kind of dumb, Lisa added.

Keeping A High Savings Rate

Despite rejecting the idea of early retirement at this point in her mid-40s, shes made great strides in reshaping her financial situation.

When she learned about FIRE, her and her husband had just walked away from buying a large, expensive home that would have put them in a tricky financial predicament. They thought they needed the big house because thats what people did after getting married. Instead of getting the house, shes paid off her student loans, two cars and some credit card debt. The family has also invested in two single-family homes, which they rent out, covering the mortgages.

Part of the reason Lisa quit her early retirement goal was because she was having to sacrifice too ... [+] much today for future possibilities.

At the peak of their saving they stashed away about 70% of their income. Now its closer to 50%. Still a strong level, but not with early retirement as the goal.

Lisas realization that theres little desire to retire before traditional age has given her the freedom to build wealth for other purposes. She has the financial knowledge now and shes using it to provide a large inheritance for her daughter one day.

I want to build legacy wealth for my family, she said. She has no problem staying at her job to grow that wealth.

But shes also in a much more secure position, whenever her job does go away.

Shes Not Deprived Of Time

Often when people say they want to retire in their 30s or 40s they have dreams of traveling across the world, seeing new sights and meeting new people. Thats not the case for Lisa. Im so content with and entrenched in the adult family life, she said.

She doesnt demand much more travel than the summer vacation her family already goes on. Meanwhile, her husband, who works in the film industry, never wants to retire because hes already found a job he would do even if he didnt have to work.

I feel like [were] not being deprived of time, said Lisa.

And now that she has clarified her goals, it makes going into work much easier.

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Heres Why This 44-Year-Olds Happiness Grew After She Abandoned Early Retirement - Forbes

What age should young adults be financially independent? The majority of Americans say 22, according to a new analysis from the Pew Research Center. But the same report finds that less than a quarter actually are by that age.

Pew analyzed Census Bureau data to find that just 24% of young adults could be considered financially independent by 22, compared to 32% in 1980. Financial independence is defined as earning an annual income of at least 150% of the federal poverty level. Pew also found that 45% of adults between the ages of 18 and 29 say they receive financial help from their parents, while 59% of parents say they support their adult children.

Recurring expenses like groceries, tuition and housing costs are the most commonly covered by parental aid, as this chart shows.

The report also noted the long-term trend of young adults putting off major life milestones, like getting married and buying a house.

A few years in the labor force significantly increases the percentage of young adults who can be considered financially independent. By 29, some 47% were financially independent in 2018, compared to 50% in 1980.

That "marginal" change hides the fact that men and women have fared much differently over the past four decades. As the share of financially independent men aged 18 to 29 has fallen from 63% in 1980 to 52% in 2018, young women have experienced the reverse, with 38% considered financially independent in 1980 compared to 42% today.

There's nothing inherently wrong with getting financial support from your parents if they are willing to give it, can afford to give it and you really do need the help, Greg McBride, chief financial analyst for Bankrate.com, tells CNBC Make It. Particularly given the economic difficulties facing young adults today, like ever-increasing student loan debt, low wages and astronomical housing costs.

Still, if you want to strike out on your own, the obvious first step to any sort of financial independence is securing a full-time job. McBride says it's fine even smart to keep living with your parents when you start working, if you are able to and they don't object. That way, you can begin saving up for your eventual "launch."

Just make sure you're pitching in, Erin Lowry, author of Broke Millennial: Stop Scraping By and Get Your Financial Life Together, tells CNBC Make It.

"That could be buying groceries for the family, or at least yourself," says Lowry, or paying some amount of rent. "If you're not working right now and can't financially support yourself or contribute [to the household], think of other ways you can be helpful to your parents, like picking up siblings from school, cooking meals or cleaning up around the house."

As you're doing that, you can start working on your own finances. To move out on your own, you need enough money to cover first and last months' rent and a security deposit (typically an additional month of rent) to secure your own apartment. Start researching housing in your area to get a sense of how much you can expect to spend each month.

"You'll need to cover all the start-up expenses, like buying furniture," adds McBride. "And you'll need emergency money for unplanned expenses, really for the first time in your life."

Most financial advisers suggest stashing away three to six months' worth of expenses in an emergency fund. But if that seems unrealistic, you'll have to make your own calculation: How much savings do you need to be comfortable in your new place, on your own? Consider your monthly bills, rent, insurance, grocery costs, etc., and how you can make those expenses work on your monthly salary.

"Another key ingredient of financial independence from your parents is to pay all of your own bills," says McBride. "You have to calibrate your expenses with your income."

For some tips on how to save, check out these CNBC Make It resources:

Don't miss: If you're afraid to invest in the stock market, do this calculation to see how much money you're losing out on

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Most Americans think young adults should be financially independent by 22but only 24% are - CNBC

A study found millennials are dipping into their retirement savings to either buy their first home or to pay down personal debt.

When he achieved financial independence at the age of 30 in 2015, Grant Sabatier knew his story was extreme.

The now-34-year-old had saved more than $1 million in just five years - after starting with a balance of $2.26 in his bank account.

Im an outlier, Sabatier told FOX Business. I am the exception to the rule.

Sabatier is a follower of the F.I.R.E. Movement -- which stands for Financial Independence, Retire Early. However, he still works and makes money by writing financial advice for his blog, Millennial Money and through speaking engagements and sales of his book, Financial Freedom.

I think the traditional concept [of retirement] is really outdated and I think within the next 10 years we wont even talk about it the same way that we talk about it now, Sabatier said. All it means for me is, once I became financially independent at 30, I started paring off all those things in my life that I didnt enjoy doing and started focusing my life around the things that I really wanted to do.

I still work really hard, [but] its mission-driven work as opposed to making money work, he added.

Grant Sabatier (pictured) saved more than $1 million in just five years and became financially independent. (Cory Vanderploeg;Courtesy of Grant Sabatier)

Most importantly, Sabatier gets to do the things that make his life richer -- but not in the financial sense.

Ultimately, money only matters if it helps you live a life you love, Sabatier said. Are you designing your life in a way that your work and your money is supporting that? And are you enjoying your life? Thats the most important thing. Its not about the million dollars, or when can you traditionally retire.

After saving for five years, Sabatier started a personal finance blog called Millennial Money and wrote a book called Financial Freedom. (Houston Bass; Courtesy of Grant Sabatier)

However, this mindset around money wasnt how Sabatier viewed financial independence when he got started in 2010.

That year, he had moved back in with his parents after hed been fired from his job. He said he was really ashamedbecause his parents had invested so much in him and he felt like he had let them -- and himself -- down.

So he decided to set the extremely arbitrary goal of saving $1 million as quickly as he could, which he realized about two and a half years in, would be about enough to live on for the rest of his life.

Even though he still technically works, Sabatier said that for him, "retirement" just meant that he stopped doing the things he didn't enjoy. "I think this idea of work, the idea of retirement, all these things are so fluid now," he told FOX Business (Courtesy of Grant Sabatier)

At that point, he decided he wanted to save the $1 million within five years -- but that turned into the only thing he did for the next two and a half years.

I just stopped doing everything, he said. All I was doing was making money and saving money I was just singularly focused on that goal.

Even though Sabatier still makes money through his blog, his book and speaking engagements, he told FOX Business that he donates or invests most of it to other people and projects in order to "keep my taxable income as low as possible," he said. (Courtesy of Grant Sabatier)

However, that came at its own cost. During those few years, he said he almost broke up with his girlfriend, who is now his wife, he didnt take good care of his health - gaining50 pounds -and he lost several friendships along the way, too.

Even though he was excited about hitting his goal, he admitted he had made a lot more sacrifices than in hindsight I probably would have made. However, the experiencewas a "net positive" overall because now he can do whatever he wants.

"But certainly I should have just chilled out a bit," he said.

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I realized somewhat later on that it wasnt about the million dollars or about becoming financially independent. What I was really seeking was just more peace in my life and more space and time and the ability to take a deep breath, Sabatier explained. I also didnt realize that so much of that freedom that I was craving, I already had access to so much earlier on.

Most of the things that make me happiest in life are pretty inexpensive or even free, he added. And so, once I started designing my life around how to have more time to do those, I realized that I needed a lot less money than I ever thought I would.

"I think the personal finance world and the money world, they always ask how much money do you need, how much money do you spend, how much money do you make, how much money do you want? When the first question should be, what kind of life do you want (Courtesy of Grant Sabatier)

Now, Sabatiers goal is passing that message on to other people throughout the F.I.R.E. Movement, including alongside one of the founders, Vicki Robin, who co-wrote the book Your Money or Your Life.

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If somethings not making your life better or richer, you should discard it, Sabatier said. And pursuing F.I.R.E. can just become money addiction in another form. People are so religious about their spreadsheets and their savings rates that it just ends up becoming just like any form of money addiction.

A lot of the work that I do or try to do in the movement is to humanize it a little bit more, he added. Lets make sure its always life before money. Its always life before money. Thats all building on Vickis work.

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Millennial millionaire who retired at 30 explains the sacrifices he made to get there - Fox Business

Eva-Katalin | E+ | Getty Images

Back-to-school season is in full swing for students throughout the educational pipeline. On college campuses, many students are starting their journey from youth dependence to adult independenceand making their first and probably one of the largest investments of their lives. For most, that means taking out college loans, assuming student debt, and finding a job to help stay afloat.

It didn't always use to be this way. Since 1980, tuition and fees at four-year public colleges and universities have risen 19 times faster than average family incomes. Given the costs of college, working while enrolled is the new normal for today's students; eight out of 10 students work while in college. But the reality is that working while in school doesn't leave enough to cover living and tuition costs. You just can't work your way through college anymore.

Working while learning takes a greater toll on low-income students. There are about six million working learners who are also low-income, and they are disproportionately women, Blacks, and Latinos. These working learners are more likely than their higher-income peers to work more than 15 hours per week, leaving less time for their studies. And rather than pursuing a professional position, many devote more hours each week to dead-end jobs. Working longer hours at these jobs may allow low-income students to earn more money in the short term. But it's usually never enough to cover their college and living expenses.

So what does this mean for grades and likelihood of completion? Where and how many hours you work is key. Fifty-nine percent of low-income students who work 15 hours or more, leaving them with less time to study and complete assignments, had a C average or lower. You could be worse off in the long run if your job is so overwhelming that you fail classes or quit the academic program all together. This is sometimes the case for low-income working learners, who are less likely than their higher-income peers to graduate on time.

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The reality is that low-income students' financial situations often prevent them from attending more selective colleges and universities. As such, they are more heavily concentrated in shorter programs that provide them with less institutional support to help them graduate on timeeven though they need support the most.

Having to work long hours isn't the only setback for low-income students. Often, their quality of work experience doesn't prepare them to get good jobs after graduation. We define a good job as one that pays family-sustaining earnings, at least $35,000 for workers ages 25-44 and at least $45,000 for workers ages 45-64.

Especially in a tight labor market, recent college graduates need directly applicable work experience to land a good job straight out of college. But the reality is that in a paid services job, a student does not learn much more than how to show up on time. This student will not fare as well when applying to jobs against candidates who have experience directly applicable to the role. So while low-income students tend to work more hours, the nature of the jobs they often take don't prepare them for a career job out of college.

On the other hand, high-income students do not have to workand they often don't. When they do work, they tend to pursue professional, unpaid internships for 15 hours per week or less, leaving them with enough time to maintain good grades. Internships or apprenticeships give them an advantage when seeking a job after graduation in the form of valuable, firm-specific experience and connections.

In the end, working in college may be a necessity, especially for low-income students, but it creates additional challenges. And even after graduation, low-income students can still be left with debt. It's no longer the case that students can work in the summers to pay for college and prepare for their first job, reaching financial independence at age 26. After celebrating graduation, students today face at least an additional four years until reaching financial independence.

The need for postsecondary education and high-quality work experience has created a new stage in the life cycle that everyone has yet to figure out. And one way to start is to provide more than just buzzword solutions to help the students who need it the most. Low-income students need more financial support and access to quality work experience. We need to fund paid work experience for these students in their field of study. Paying students to engage in relevant work is the best way to set them up to begin a prosperous career after graduation. With better pay in their entry-level jobs, low-income students will also be better positioned to pay off their student debtand reach financial independence sooner.

Dr. Carnevale is Director and Research Professor at the Georgetown University Center on Education and the Workforce. CEW is an independent, nonprofit research and policy institute affiliated with the Georgetown McCourt School of Public Policy that studies the link between education, career qualifications, and workforce demands.

Follow CEW on Twitter (@GeorgetownCEW), LinkedIn, Medium, YouTube, and Facebook.

Sources: Georgetown CEW analysis of data from the College Board, U.S. Census Bureau, Bureau of Labor Statistics, U.S. Department of Education and National Center for Education Statistics.

CHECK OUT:How to get Costco savings without buying the $60 membershipviaGrow with Acorns+CNBC.

Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.

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Working while in college might hurt students more than it helps - CNBC

Amon and Christina have been able to retire in their forties after saving for eight years (Picture: Our Rich Journey /SWNS.COM)

In need of some inspiration for your saving?

Take a look at parents Christina, 41, and Amon Browning, 39, whove been able to retire early after saving two million dollars (around 1.5million) in the space of eight years.

How did they do it? With a seriously strict budget and plenty of side hustles.

While the couple, who both worked as civil servants, dont want to reveal the exact figure they saved, they say they now have enough to mean theyll never work another day in their lives.

Thats great news for their children, Sunoa, 13, and Melea, 11, who now get to spend a load of time with their parents.

The family has now moved from San Francisco to Lisbon, Portugal to live a life of leisure. Anyone else jealous?

Amon, who brought home $98,000 a year as an urban planner, and Christina, who earned $70,000 as a federal attorney, insisted that almost anybody can retire early if they follow their example and join the Financial Independence Retire Early movement, known as FIRE.

Christina said: The FIRE journey is all about saving money, making money and investing that money.

But before you do all that, you have to believe that you can do it. Its about your mindset.

Amon realised he wanted to retire early when he received an award for ten years service at work in 2011.

He said: That was a life changing moment. You can work for so many years and all you get to show for it is a piece of paper.

I really wanted more out of life than this.

The idea of working another 30 years in a cubicle and missing out on life was crazy to me.

Christina and Amon worked together to create FIRE, which now has thousands of followers working to put away enough money to ditch the world of work.

They gave themselves a ten-year plan to become financially independent and able to retire by 2021.

In 2013 they began flipping homes, buying their first fixer-upper in the San Francisco area by putting just 3% of the property price down, which was $17,000.

They lived in the home while they did it up, sold it, and then did the same thing again with two more properties, allowing them to gain over $400,000 in profit.

The couple also sold spare possessions on Craigslist and Facebook Marketplace, and signed up to become Uber and Lyft they say they earned $26,000 without ever having to pick up any passengers.

Amon said: For a period we drove for Uber and Lyft in the San Francisco bay area.

For us, it was all about the hack. The companies were giving $40 an hour just to turn on the app.

We would literally get no rides but wed still get the sign-up bonus.

I think we made $26,000 just on this Uber and Lyft hack, not driving at all.

All the extra money went into low-cost index funds.

Amon said: You start off with investing all your tax advantage accounts the ones you have at work, your retirement funds.

In our 401k, we invested in an index fund that tracked the stock markets, we werent dabbling in individual stocks.

The return on the stock market is historically eight to 10% so we just plowed our extra money into the index funds.

The family made some lifestyle changes, too, including trading in a BMW for an $800 minivan

They also made changes in their lifestyle including trading in their brand new BMW SUV for an $800 minivan. But the parents made sure that throughout their scrimping and saving, the family was still able to have fun.

Each year Amon and Christina used sign up bonuses on credit cards to pay for a big holiday, heading on vacations toThailand, Hawaii, and Singapore.

The couple are sharing their story to show other parents that they can save enough money to retire early.

Amon said: When people say that children are expensive you make children expensive if you are trying to give them the world.

People will go broke for their children but they wont become rich for them.

Weve seen people overspend on toys and activities. But we never found our children to be expensive. We have a minimalist mindset.

We didnt give out gifts at Christmas but we went on trips.

Our girls can remember that they were in Paris on Christmas Day or in Singapore or in Thailand.

In 2016 their savings got a boost when the couple moved to Japan with work, where they lived rent-free. This allowed them to save 70% of their income and invest it for three years.

Following that time, the couple hit their goal of financial independence two years earlier than expected. They were able to retire in July this year, then moved to Portugal because of its weather, education, health care, and the low cost of living.

The familys outgoings are now around $4,500 a month.

Amon and Christina now spend their days with their children,taking Portuguese classes, traveling around Europe and focussing on their physical fitness, with Christina swimming and Amon playing basketball.

They also focus on their Youtube channel, Our Rich Journey, where they share their tips and tricks on achieving FIRE.

Amon said: We just took 40 hours a week back.

We are so busy every single day.

What type of life is it commuting to work every day and sitting at your desk?

I can organize my own life and my own day now.

What is most important is that we are not tired at the end of the day when we meet our children.

We have the energy to keep up with them.

MORE: How I Save: The 28-year-old senior marketing executive in Manchester with 16,750 saved

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MORE: How I Save: The 24-year-old blogger and consultant with 75,000 saved

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Mum and dad retire early after saving millions in just eight years - Metro.co.uk

In a survey of 2,096 Americans from Morning Consult and Insider, the majority of Americans reported they had a financial imbalance going into their current relationships.

About 44% of people surveyed who were either married to or living with a partner said that they made more money than their partner before they started dating, and 30% said they made less. All told, about 74% of people surveyed reported having some financial imbalance before they started their relationship. Only 26% of people said they came into their relationship making about the same amount of money.

Having significantly more or less money than a partner can be a big point of contention in relationship. When bestselling personal finance author Ramit Sethi asked his 143,000 Twitter followers what they would do if their partners earned more than they did, the vast majority of people replied with positive reactions like "OMG, that would be AMAZING! Our household income would go up it's great!"

However, he wrote in a post for Business Insider, "Those same people emailed me 45 minutes later and confided in me that they earned more than their partner and hated it." He later got several emails from people who said they made more than their partner, who "resented" their lower-earning partner, felt that they were "mothering them," or felt that they "weren't ambitious."

But, as Insider and Morning Consult's survey shows, uneven incomes is a situation familiar to a lot of American couples.

Relationship expert Susan Winter told Insider's Sara Hendricks that money imbalances in relationships don't always cause problems inherently, explaining that it's often the implication of power that can be problematic. "Traditionally speaking, money equals power, and the one with the power is the one who controls the relationship," Winter told Insider.

Winter suggests keeping some form of financial independence, even as your relationship gets more serious. And as far as making the power dynamic in a relationship feel more balanced, she suggests to Insider, "Begin with the basic question of 'who does what?' If your partner makes all the money, how can you contribute in a way that feels important and valued?"

Business Insider contributor Jennifer Still wrote about making more money than her partner, saying, "My partner sometimes feels guilty for not contributing as much financially to our relationship, even though it's not something I ever think about or hold against her." She continues: "Our wage discrepancy is entirely circumstantial and something we've worked hard to make a non-issue in our relationship, but I think we'd both be lying if we said we'd conquered our respective concerns entirely."

However, she writes, "Ultimately, money isn't such a huge issue in our relationship that we're constantly preoccupied with it."

Whatever the earnings dynamic in your own relationship, experts recommend being open about money with your partner. "I'd say more often than not, people probably aren't exactly on the same page," financial planner Christine Centino previously told Business Insider.

Her favorite tangible sign of couples who are communicating well about money is a simple spreadsheet. "They've both gone through this spreadsheet," she told Business Insider. "They have all the numbers and they're like, 'here's what we want to do.'"

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Most coupled Americans earn much more or less than their partner - Business Insider

Accomplishing the financial cushion to retire early is a fantasy for most. Bringing the fantasy to reality is not as difficult as it sounds. The key is straightforward: Save significantly more every month. Sounds simple, correct? One moment.

Usually, advisors advise 15% to 20% of total income saved every month as an objective - yet in the event that you want to retire earlier, you likely need to tighten that number up to 40% or half of your pay. Not a discipline easily practiced when you review or consider that a substantial segment of your paycheck goes to basic, non- negotiable lifestyle needs. But if you are willing to make some serious lifestyle adjustments and trade-offs, it's achievable.

This concept of intensive saving for an early retirement has spawned a movement called FIRE (Financial Independence, Retire Early). Followers of FIRE strive to save up to three-quarters of their income, and make other adjustments too: live in small homes, walk to work each day, practice strict diet plans, and more. Even if this lifestyle may sound a bit unreasonable, the ideas behind it are worth considering.

The first point is to adhere to the key principles of long-term investing, including developing a diversified portfolio that includes stocks with various styles, sizes, sectors and regions.

To accelerate the retirement investment cycle, you can construct a portfolio designed with more risk - and the potential for higher returns - but it should still be appropriately diversified to protect against larger than average market drawdowns that can be difficult to recover from and ruin any chance to accomplish your early retirement goal. There are numerous ways to diversify a portfolio, and how you do so should depend on your age, your risk tolerance, your growth and income needs, and your long-term goals.

After accelerating your savings and setting up an ongoing plan, invest your savings into your portfolio at the earliest opportunity. Try not to attempt to time the market. Stay put, and let the compounding characteristics of the markets do its work to help grow your retirement wealth exponentially over time.

Astute investors pick retirement growth stocks with low beta, strong earnings estimates, positive sales growth, and expected future growth.

Zacks offers investors useful rankings for lower risk growth stocks for retirement portfolios. The following are a few selections that merit a closer look: Grupo Aeroportuario del Sureste (ASR), EQT Midstream Partners, LP (EQM) and Banner (BANR). Earnings and revenue has seen growth of at least 5% or higher over the last five years, with a beta of 1 or lower.

Do You Know the Top 9 Retirement Investing Mistakes?

Whether you're planning to retire early or not, don't let investing mistakes derail your plans.

If you have $500,000 or more to invest and want to learn more, click the link to download our free report, 9 Retirement Mistakes that will Ruin Your Retirement.

This report will help you steer clear of the most common mistakes, like trying to time the market, lack of diversification in your portfolio, and many more. Get Your FREE Guide NowBanner Corporation (BANR) : Free Stock Analysis ReportGrupo Aeroportuario del Sureste, S.A. de C.V. (ASR) : Free Stock Analysis ReportEQT Midstream Partners, LP (EQM) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research

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Powerful Proof Anyone Can Invest for an Early Retirement - October 25, 2019 - Yahoo Finance UK

Elephant stands on thin branch of withered tree in surreal landscape. This is a 3d render ... [+] illustration

As a couples therapist practicing in the non-stop, always-buzzing city of San Francisco, Ive seen my fair share of dual-career marriages. Tech executives, financial professionals, lawyers and others in demanding or high-profile jobs come to me asking for help. For many of these clients, their chief complaint is being unable to nurture their relationships amid their hectic lives: We have two very demanding careers. We each work 10 or 12 hours a day, and we dont have enough time for each other.

Adding to this already-precarious situation is an issue common to dual-career couples: financial independence. With each partner pulling in a six-figure salary, either could comfortably sustain a household on their own should they split up. In the absence of such financial constraints, staying together is a choice, not a necessity, and its my job to help them choose each other every single day.

Balancing the demands of a job, a personal life, a digital life (i.e., the daily onslaught of texts, emails and posts), and a committed relationship can be exhausting. Understandably, its downright too much at times. Sometimes, calling it quits can seem like the easier path.

Our digital lives in particular are adding new stresses to our partnerships. If your relationship is in a bit of is slump, your friend-of-a-friends social media post showcasing pictures from a second honeymoon can leave you feeling dejected and frustrated. Why isnt my relationship like that? youll ask yourself, forgetting for the moment that posts on social media are often filtered through rose-colored lenses. Even worse, you might find yourself in a shame-spiral: How do other couples do it, when were struggling? Why arent we better at this?

While there will never be a single secret ingredient to achieving marital bliss, dual-career couples can, with a touch of extra effort, successfully balance their jobs with their relationships. Here are five tips to help you do just that.

Reduce Everyday Noise

Cutting out the white noise in your life is no easy task. It requires evaluating your landscape and then effecting change. Yet, just like during spring cleaning, getting rid of things can be hardotherwise our closets wouldnt be jam-packed with ten-year-old sweaters that no longer fit. Were afraid to let go, asking ourselves, What if I need that?

For dual-professional couples especially, everyday white noise can feel much like that pile of old sweaters. In a demanding position, its common to feel on call at all times, just in case some unforeseen need arises. For some of us, its hard to acknowledge that were wasting resourcesbe it time, energy, or closet spaceon what ifs. Resources that could be redirected into our marriages.

Effectively managing white noise, and the slew of micro-demands that come with it, is a key component to a healthy relationship. Whether its slowing down on how quickly you respond to texts, limiting your time on professional blogs, turning off your phone after nine oclock, or even de-prioritizing a friendship youve outgrown, ultimately youll have more time and focus to give to your relationship.

Prioritize Your Relationship

Anyone in a committed partnership has heard that relentless phrase, Relationships take work! And its true, no healthy relationship runs on autopilot. Theres no getting around it: To preserve your marriage, you must prioritize it.

Among other things, prioritizing means you must always reserve a few gallons in your gas tank for your spouse. Even if youre dog-tired when you get home from work, take a few minutes to check in with your partner. Prioritizing means you do this even if your big deal fell through, even if youre facing an impossible deadline, even if your boss chewed you out after lunch.

Office concerns can send anyones head swimming, but theyre no excuse for neglecting to ask about your spouses day and the struggles they faced. These conversations, no matter how short, will keep you and your partner connected despite the demanding throes of your jobs.

Make Clear Commitmentsand Keep Them

If you have an intense work schedule, intentional, mindful nurturing of your relationship is essential. You must carve out time for your spouse and protect that time. Commit to a movie night once a week, a monthly date night or a quarterly weekend getaway. Whatever methods you choose, this is time for you and your spouse only; its a chance to unwind, reconnect, and simply appreciate being with each other.

Theres some serious fine print that comes along with commitments: they must be kept. When life is pulling you in a thousand directions at once, its too easy to let things slip through the cracks. Your marriage, though, is not one of these things. Be accountable to your partner: if you cant keep a commitment, its on you to reschedule as a way of prioritizing your marriage. Its okay to occasionally shift a date night to another calendar slot to fit your over-scheduled life, but its not okay to forget.

Bring Innovation to Your Affection

Yes, youre busy. Very busy. We understand, we get it. But no matter how taxing your job is, your spouse is a part of your heart and mind, even if your focus in the moment is on the report youre presenting. However, after youve nailed that presentation (and after youve taken a deep breath), seizing a moment or two to remind your partner of your affection can have a big impact on your relationship. And, even though the digital age brings certain challenges, it also makes it easier than ever to show your appreciation and love for your partner.

Order your spouse a surprise lunch using your favorite menu app. Email an article about an exhibit youd like to see together. Shoot off a text with an inside joke. Send a selfie with Missing you in the caption. These gestures dont need to be sweeping or grandand in fact they shouldnt be. The point is showing your affection in small ways, even when youre not physically together. A simple, Im thinking of you is the gold youre after.

Appreciate the Here and Now

If youre like most dual-career couples, its easy to get lost in times whirlwind. August seems to jump straight into October and by the time you look up again, New Years Day is around the corner. As important as your job is, dont let time slip by in the blink of an eye.

The present holds the key to building a beautiful future, not the other way around. Each day, simply ask yourself this question, What did I do today to connect with my partner? If you come up short, you need to put a bit more effort in. Start immediately: talk to your spouse with curiosity and attentiveness. A small Im listening goes a long way. A hug never hurts, either. These tiny, in-the-present acts cultivate continued connection over the long haul.

Theres no doubt that our careers are important. Aside from financial livelihood, our jobs can offer us immense professional satisfaction, and we work hard to achieve our goals. Yet work is never a reason for neglecting a marriage, not even when both of you are in high-pressure roles. While the balancing act can be difficult at times, the effort itself is important. By demonstrating to your spouse that youre engaged in your relationship and deeply committed to your partnership, youre enriching the soil in which your marriage grows.

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Your Marriage Or Your Job? How To Balance Your Career And Your Relationship - Forbes

Hood River County intends to rework the local option tax that failed on the May 2019 ballot, with the hope that they can get something passed to help stabilize the countys financial situation.

The original measure, called the Public Health and Safety Five-Year Local Option Tax, asked voters to approve a tax rate of 89 cents per $1,000 assessed value to support public health and safety services provided by Hood River County. It failed 51.43 percent to 48.57 percent a closer margin than the countys second revenue measure on the May 2019 ballot, the Prepared Food and Beverage Tax, which failed 59.45 percent to 40.55 percent.

While the county commission decided to abandon the Prepared Food and Beverage Tax, the commissioners agreed that it was worth seeking outside advice on reworking the local option tax for a future ballot.

They invited Mark Weiner, co-founder of the public-affairs political consulting firm Winning Mark, to an Oct. 21 work session to discuss what Hood River County should focus on in reworking the measure.

Weiner told the commissioners that it wouldnt be smart to ask for a levy rate higher than the 89 cents they asked for in May even though the previous levy was paired with the Prepared Food and Beverage Tax proposal.I know its easy to be gloomy about that because every cent on that levy is a vital service, said Weiner, but the reality of it is voters want to feel like theyve been heard and the first place theyre going to process that is, whats the total cost of what youre coming back with.

The commissioners agreed to setting a rate somewhere between 67 cents per $1,000 assessed value the minimum needed to fill the deficit and the 89 cents per $1,000 assessed value that they asked for in May.

I dont think you can convince the public that you arent going out for more than we did last time if we go above 89 cents, said Commission Chair Mike Oates.

The 67 cent rate would be just enough to take the place of the annual $750,000 reserve fund withdrawals that have kept the budget stable for the last few years (that fund will be depleted by the 2020-2021 fiscal year) and, to fund county services, would still see some cuts as departments stop unsustainable practices, such as excessive overtime, and drop to a sustainable service level.

We have been attempting to tread water and maintain services but were going backwards, Commissioner Les Perkins said. What we choose to do with services, we have to staff appropriately.

One of the problems with the two previous measures, Weiner said, is that they were funding a laundry list of everything the county does, and that this new measure needed to connect each cent of the levy rate to direct service impacts.

Taking that advice, commissioners decided to narrow the scope of the levy to just public safety; specifically, the Hood River County Sheriffs Department.While the previous measure was to fund both healthcare services and public safety, the new measure the county is working on for either the May or November 2020 ballot will narrow the focus to just public safety.

The commissioners decided it would be simpler to leave healthcare services out of the levy because Oregon has an all or none structure for county health departments meaning that the county cant make significant cuts to the health department without dissolving the department entirely and turning all healthcare services over to the state.

The commissioners agreed that including healthcare services as part of the levy would complicate messaging and make the measure harder to pass.The sheriffs department receives the largest chunk of the countys general fund expenditures 11.4 percent, just under $5.47 million of the countys $13.48 million general fund for the 2019/20 fiscal year and it would be the department facing the biggest budget cuts if a levy doesnt pass.Law enforcement was also the highest-ranking county service in a recent prioritization exercise completed by the commissioners (see sidebar for details).

On Oct. 7, the Hood River County Board of Commissioners participated in a prioritization exercise in an attempt to rank all of the services the county provides, in the hopes that the ranking would help the commissioners in future budget planning. Commissioners were each given 62 stickers to spread amongst approximately 90 services, each listed on sheets of chart paper hung up around the meeting room, and told to assign stickers to the services they valued most the only limitation that each commissioner couldnt put more than three stickers on one service. The commissioners completed the exercise in about 45 minutes, with department heads on-hand to answer any questions. Mostly, they watched in silence as the commissioners put up their stickers. I hope you didnt come away with this thinking that if you got a low number, youre not valued, said Commission President Mike Oates to the department heads gathered at an Oct. 21 work session, where the commissioners reviewed the results of the exercise. Im sorry we had to do this, but its part of the process.Overall, law enforcement ranked the highest, followed closely by managing the certified tree farm, maternal and child health, the jail, and tax collection. The full list is included in the commissions Oct. 21 meeting packet, available on the county website, http://www.co.hood-river.or.us (click on the Board of Commissioners under the County Departments tab, follow the link to Meeting Agendas and Minutes, then to Meeting Agendas). While the commissioners agreed that, since the list generally doesnt consider the finances associated with each service, it wouldnt be very useful in budgeting, but would be an informative resource in reworking the levy.

I think it fits pretty well if you ask for public safety, said Commissioner Bob Benton.Sheriff Matt English has previously told the commissioners that he is interested in pursuing a public safety levy to give the sheriffs department financial independence from the countys general fund, and the commissioners requested that English prepare an updated department budget and list of services for an Oct. 28 work session.

By the end of that work session, the commissioners said they hope to have agreed on a tentative levy rate and the specific public safety services that levy would fund.

When asked whether the county should be planning for the May or November 2020 ballot, Weiner said that the most important factor would be how much time it would take the county to do effective public outreach, including getting voter feedback before the ballot language is finalized.

I wouldnt be afraid of May, Weiner said, adding, theres no question that you could get that work done if they started now.While November 2020 would have a larger voter turnout due to the presidential election, Weiner said that a historic turnout is still expected for May 2020 due to the Democratic primary.

Concerned about the financial implications of having to wait another fiscal year for the November 2020 ballot, Oates said that he wanted to try for the May ballot, and he set a goal for getting enough information together to start public outreach by the end of November.

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County to rework failed levy proposal for future ballot; New measure to focus on funding public safety - Hood River News

More and more lately, Im hearing the praises of total market funds as alternatives to S&P 500 index SPX, +0.41% funds.

Unfortunately, many advocates of total market funds dont realize they arent fundamentally different from S&P 500 funds.

Fortunately, theres an even better alternative, which Ill get to.

As you probably know, the S&P 500 is made up of 500 of the largest publicly traded companies in the United States. But what many people do not know and understand is that the index is capitalization-weighted.

Heres what that means: The index is overwhelmingly dominated by the stocks of companies with the highest market capitalizations. (Market capitalization is equal to the stock price times the total shares outstanding.)

Sure, there are 500 stocks in the index, and that should provide quite a bit of diversification. But in fact, a handful of megacompanies like Microsoft MSFT, +0.56%, Apple AAPL, +1.23%, Google GOOG, +0.33% GOOGL, +0.41%, Amazon AMZN, -1.09%, Berkshire Hathaway BRK.A, +0.64% BRK.B, +0.73%, Exxon Mobil XOM, +0.23%, and J.P. Morgan Chase JPM, +0.80% account for a large part of the ups and downs of the index.

Indeed, the 10 largest companies (2% of the stocks in the index) make up more than 20% of the index.

The S&P 500, in other words, is dominated by a few companies in a few industries. All of these, essentially by definition, are large-cap growth stocks.

But one commonly-suggested remedy for greater diversification, the total market index fund, isnt a whole lot better.

Standard & Poors has a Total Market Index (TMI) that, according to the company, is designed to track the broad equity market, including large-, mid-, small-, and microcap stocks.

That might sound like a welcome dose of diversification, but it isnt.

The TMI, like the S&P 500, is also capitalization weighted. So yes, it includes small-cap and microcap stocks. But their contribution to the index itself is minuscule.

Heres an analogy from American history: The Boston Tea Party was a big deal politically. But it didnt do much to change the flavor of the water in Boston Harbor.

The widespread misunderstanding of TMI funds came to my attention recently as I worked with some of the leaders of the FIRE (financial independence, retire early) movement.

One of their heroes, J.L. Collins, has written a book that is popular among FIRE members, recommending the TMI VTSAX, +0.43% (instead of the S&P 500) as the index on which they should build their portfolios.

I have spoken to many TMI advocates over the years. When I go through my presentation about the benefits of investing in value stocks and small-cap stocks, they are pleased, since they have been taught that they have the proper amounts of these asset classes.

But it just isnt so.

In either index, the stocks of the largest companies are responsible for most of the gains or losses each day, each week, each month, and each year. In fact, its not unusual for the biggest 50 companies to be responsible for the majority of the behavior of these indexes.

In S&P 500 index funds, investors get almost exclusively large-cap growth and large-cap value. TMI index funds are similar as are their returns.

Consider: In a recent study we compared the returns of many asset classes over a series of different periods.

Heres some of what we found:

From 1928 through 1974, the S&P 500 had a compound return of 7.8%, the TMI 7.3%.

From 1975 through 1999, the S&P 500 return was 17.2%, the TMI 17.3%.

From 2000 through 2018, the returns were 4.9% for the S&P 500, 5.2% for the TMI.

For the entire 91-year period, the S&P 500 compounded at 9.7%, the TMI at 9.5%.

(These and the other return figures Im citing do not include any fund expenses.)

The conclusion seems obvious and hard to deny: There wasnt a large performance difference between S&P 500 and TMI.

As I mentioned, theres a better way to obtain the real value of the total U.S. stock market: Diversify by adding important asset classes.

The four most important U.S. equity asset classes are large-cap growth, large-cap value, small-cap growth, and small-cap value.

If I had to pick just one major U.S. asset class to use as a diversifier against either the S&P 500 or the TMI, it would be small-cap value stocks. (In fact, Im finishing up work on writing a book on that very topic.)

For the four periods I discussed above, heres how small-cap value stocks performed, compared with the TMI.

From 1928 through 1974, small-cap value 9.1%, TMI 7.3%.

From 1975 through 1999, small-cap value 22.3%, TMI 17.3%.

From 2000 through 2018, small-cap value 11.2%, TMI 5.2%.

For the 91 years 1928 through 2018, small-cap value 13.1%, TMI 9.5%.

You dont have to go way out on a limb to get the benefits of small-cap value investing.

Our studies show that, over a typical 40-year time horizon for retirement investing, if your equity portfolio is mostly in an S&P 500 fund, a TMI fund or a target-date retirement fund, shifting just 10% of that into small-cap value stocks can boost your earnings by 25% or more over those 40 years.

But heres an even better idea for the equity part of your portfolio: Ditch the TMI or S&P 500 fund, and diversify equally among large-cap growth, large-cap value, small-cap growth, and small-cap value.

All these asset classes are available in low-cost index funds. This gives small-cap stocks and value stocks a chance to actually make a difference in overall returns.

From 1970 through 2018, that combination of four asset classes would have produced a compound return of 12.7%, compared with 10.2% for either the S&P 500 or the TMI.

That difference might not seem overwhelming, but with compounding over those 49 years, it would triple the return in dollars.

This may not be for everybody. But its certainly worth thinking about.

For something else worth thinking about, listen to my latest podcast: Which does better in bear markets: actively managed or passively managed funds?

Richard Buck contributed to this article.

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This strategy beats a total stock market fund and gives you more diversification - MarketWatch