By Paula Pant
Money, relationships, health and purpose: life is running smoothly when all four of these elements are working together in tandem, like wheels on a car.
But how can we make spending and investing choices that facilitate stronger relationships, better health and a deeper sense of purpose?
Andrew Hallam, who became a millionaire on a teacher’s salary, shares researched-backed, evidence-based insights into how to find balance, drawing from the worlds of behavioral finance and stock market history.
By Paula Pant
“What’s your FI number? What’s your FI date?”
People often talk about financial independence like it’s a fixed, static point. When your portfolio reaches $X value, or your monthly passive income is $Y per month, you’re FI.
“When did you reach FI?,” people will ask, as though it’s a one-way door with a distinct date, comparable to graduating from high school or college.
Today’s podcast guest, J.D. Roth, offers a fresh perspective: FI isn’t a fixed point. It’s a continuum, a spectrum.
He says there are seven stages along the road to financial independence, which include:
1: Dependence: This is what we experience when we’re five years old: total reliance on someone else.
This is also what we experience as adults if we depend on our credit cards for basics like groceries and utilities, and we can’t pay the balance in full at the end of the month.
2: Solvency: You can make your minimum payments, and you’re not adding new credit card debt to your monthly balance.
By Erin @ Team Afford Anything
PSA Thursday is back! In case you’re a new listener, PSA Thursday is a weekly-ish segment in which we talk about how to handle money, work, and life in the middle of a pandemic.
With the uncertainty of the Affordable Care Act (ACA) looming before us, many are asking:
What will happen if the ACA is struck down by the Supreme Court? How can we plan for healthcare – now and in the future? How much will I need saved to cover healthcare in retirement? What can I do if I can’t afford the expensive premiums?
As a community of entrepreneurs and early retirees, this is a major concern.
To help us understand the healthcare landscape, we brought on Tanja Hester, author of Work Optional and the blog Our Next Life.
Tanja has extensive experience with the healthcare system. She has a history of pre-existing conditions dating back to childhood, and she has also navigated the marketplace post-retirement.
By Erin @ Team Afford Anything
Are you wondering how in the world you’re supposed to plan for retirement given the craziness of the year 2020?
You’re not alone.
That’s why we brought Dr. Wade Pfau on the show. Dr. Pfau is a Professor of Retirement Income for the American College of Financial Services. Dr. Pfau has made a major name for himself within the field of retirement planning. He’s a two-time winner of the Journal of Financial Planning Montgomery-Warschauer Award and two-time winner of the Academic Thought Leadership Award from the Retirement Income Industry Association.
Dr. Pfau also won an award for best paper in the retirement category from the Academy of Financial Services. In 2014, he was named “40 Under 40” by InvestmentNews. He is a co-editor of the Journal of Personal Finance, and he speaks frequently at national conferences of organizations for financial professionals.
He is a RetireMentor for MarketWatch, the Director of Retirement Research for McLean Asset Management, and an Expert Panelist for The Wall Street Journal. He holds a doctorate in economics from Princeton University, and he’s also a Chartered Financial Analyst.
By Erin @ Team Afford Anything
Jillian Johnsrud grew up at the poverty line. Her mother had two children by age 19, and Jillian was raised in a town of 700 people, living in a home that struggled to afford the basics.
She married her husband when she herself was 19 years old. During their first year of marriage, they lived in a camper and earned a combined income of $12,000.
Her husband joined the military after graduating from college. They relocated to Washington D.C., where they earned a combined $60,000 per year. They saved half of their income and used their savings to wipe out $55,000 of debt.
At 22 years old, Jillian and her husband adopted a son. Two years later, at age 24, the couple had accumulated their first $100,000. The following year, they gave birth to a second child.
Jillian and her husband continued saving half of their income. Eventually, they bought a house in cash, invested in two rental properties, and built a portfolio of index funds.
By age 32, Jillian and her husband achieved financial independence. And they built this on a modest five-figure income.
How did Jillian and her husband live on $12,000 per year? How did they save their first $100,000 by age 24? What sacrifices did they make? And how did reaching financial independence change their relationship with money? Find out in this raw, emotional interview.
By Erin @ Team Afford Anything
Can you imagine living on 44 cents a day?
Kristy Shen doesn’t need to imagine it. She lived it.
Kristy grew up in rural China, where 85 percent of the population lived in abject poverty.
When she was eight, her family emigrated to Canada. In Kristy’s eyes, her family’s newfound ability to buy a can of Coca-Cola meant that they had “made it.” Kristy loved her Coke can so much that she turned it into a toothbrush holder.
Years later, Kristy met Bryce Leung at university, where they were classroom lab partners. They married, settled in Toronto and started saving for a downpayment on a house.
When their down payment savings hit $500,000, they started to question the wisdom of dumping their money into an expensive personal residence.
Fueled by curiosity, they stumbled down the financial independence rabbit hole. After countless hours of research and number-crunching, they ditched their plan to buy a house and invested their $500,000 into the stock and bond market. Around seven years later, their net worth reached $1 million.
By Erin @ Team Afford Anything
Michael Robinson and his wife, Ellen, achieved financial independence at age 33. They ‘retired’ (they still enjoy working) three years later at age 36 on two five-figure incomes. Today, Michael and Ellen are raising their two children to be bilingual by slow traveling throughout Latin America.
Michael and Ellen blog about their FIRE adventures at uncommondream.com. They believe that “the Uncommon Dream is the dream pursued – the dream met with planning, action, and sacrifice. With just a dream and those three tools, you can accomplish almost anything.”
Today, Michael joins us on the show to talk about the seven ways that he and Ellen escaped the rat race and achieved FI at 33.
By Paula Pant
Earlier this year, Cody and Justin from The FI Show interviewed me and asked some excellent questions about my journey to financial independence, entrepreneurship and passion, and minding the gap between your income and expenses.
We talk about the importance of side hustling and how to create a well-paying job from your skills.
We touch on real estate and why I chose this strategy to reach FI.
We also discuss the bone I have to pick with the financial independence movement.
Written By Paula Pant
In June, I flew to Atlanta and toured a few of my rental units. This was the second visit I’ve made to these properties in four years.
During that visit, I met with my property manager and a few of my tenants, and I had lunch with my contractor. He and I met at a suburban Atlanta strip mall.
We ordered a basket of spicy chicken wings and fries, then took out a water-logged spiral notebook and planned a $20,000 renovation.
Here’s what the early brainstormed edition of those plans looked like:
By Paula Pant
It’s September! If you’ve been listening to the show for the past few months, then you know that I’m on what I’ve dubbed my September Sabbatical, in which I’m traveling the globe and taking a break from podcast production.
In light of that, we’re digging through the archives and airing some of my favorite interviews on the show, in between airing interviews I’ve done on other podcasts.
Welcome to another episode from our archives! This one was recorded in March 2018, and Dr. Wade Pfau had a ton of insight into the four percent rule that so many of us are concerned with.
First, here’s a brief history of how the four percent rule came to be.
In 1994, William Bengen decided to look at 30-year timespans throughout U.S. History, beginning with the year 1926.
He worked under the assumption that a retiree held 50 percent stocks (in the form of S&P 500 Index), and 50 percent bonds (intermediate-term government bonds).
