Dumb Financial Decisions: Financial Fails From Our Walt Disney World Vacation

Financial IndependenceLast month the ROMT family made our first trip to Walt Disney World!

While both Mrs. ROMT and I had visited in the past, this trip was the first time our elementary school-aged children visited Florida and the House of the Mouse.

All in all, we had a great family vacation and made lots of memories with one another. We’ll share some of the highlights in this and future posts.

Along the way, we also made a number of smart – and dumb – financial decisions.

We’ll focus on the poor financial decisions associated with our vacation in today’s post, and save the good financial news for next time around!

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What the Media and Academics Don’t Understand About FIRE

FIRELast month, Stanford University Professor John B. Shoven, and three former Stanford students, Gila Bronshtein, Jason Scott, and Sita N. Slavov, published a paper entitled “The Power Of Working Longer” through the National Bureau Of Economic Research.

One of their key findings was “that working 3 to 6 extra months has an equivalent impact on the affordable sustainable standard of living as saving one percentage point more for 30 years.”

Their “primary conclusion is that working longer is relatively powerful compared to saving more for most people.”

The media jumped upon their research, with Bloomberg View columnist Justin Fox gushing that a 49 year old “could take the drastic step of upping your retirement savings by 10 percent of your salary. Or you could achieve the same result by retiring two years and five months later than you had been planning to.”

Which left me shaking my head.

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Our Solar Energy Bank Goes Bust

Early Retirement
Any guess which panels are producing lots of energy and which panels aren’t producing much at all?

Our solar energy bank finally went bust in January.

Since we didn’t have solar panels installed until last June, we knew our first winter with solar energy would likely be our most expensive. We missed out on several months of strong sunlight last spring that would have allowed us to build up more solar energy credits heading into the winter.

We tapped into the credits we built up last summer to keep our electric bills at minimal levels in November and December, but we finally drew our balance down to zero last month. Short and dark days, and lots of ice and snow, kept our panels from producing much electricity from late December through late January. Our solar energy production for the past month was less than 10% of what we produced in August. Continue Reading

An Unexpected Raise!

Financial IndependenceI’ve intentionally tried to keep Retiring On My Terms a politics-free zone.

There are some political issues I care deeply about and others that matter less to my family and I.

I’ve found when discussing U.S. politics, unless you surround yourself only with people who think exactly the same way you do, roughly half of the people will agree with you, and roughly half of the people will disagree with you – and in some cases, think you are ignorant, nuts, or evil!

So I do my best to avoid going down that path at all here.

That said, what happens in Washington D.C. impacts our family on a daily basis, and recent developments have been positive for the ROMT family’s finances!

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Why I’m Not Investing in Cryptocurrencies like Bitcoin

Early RetirementIn my recent article on our financial resolutions for 2018 I mentioned I did not want to invest in bitcoin, or any other cryptocurrencies, this year.

It’s not because I’m against making money.

It’s not because I don’t see the potential value in blockchains.

And it’s not because I think all cryptocurrencies won’t have any value five years from now.

But there are several reasons why I’d personally be very uncomfortable investing in cryptocurrencies right now, which I’ll outline below.

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ROMT’s Financial Resolutions for 2018

Financial Independence2017 was a good year for the ROMT family’s finances.

We paid off our mortgage!

We had solar panels installed on our roof, which over the second half of 2017 cut our electric bill by over 90% from what we paid during the same period in 2016!

We learned about financial independence and early retirement (FIRE), and developed a plan we hope can lead us down the path to FIRE before Mrs. ROMT or I turn 50. As of January 1, 2018, we were almost 78% of the way to our net worth goal!

2017 wasn’t without some missteps. My commute is still too long and too expensive, I’ve done a poor job taking care of myself, and our participation in the neighborhood garage sale was an abject failure!

But all in all, it was still a good year for our bottom line.

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Q4 2017 Financial Scorecard: Slow And Steady Wins The Race!

Personal FinanceWith the calendar finally turning to 2018, it’s time to report on the ROMT family’s financial status as of year-end 2017!

We made progress on each of our financial independence and early retirement goals during the fourth quarter, increasing our Net Worth, 529 Account Funding, and Passive Income.

Measuring our progress on a regular basis certainly helps keep our eyes on the prize, but we’ve found there are really no secrets to continuing to move in the right direction.

For those of us who aren’t founders of tech startups, first round NFL draft picks, or lottery winners, slow and steady progress is the surest way to build wealth over time.

Keeping our personal finances in order is largely a matter of doing the basic blocking and tackling on a daily basis.  Trying to save a larger portion of our income, making sure our money is working as hard for us as we are, avoiding unnecessary expenditures, and taking full advantage of any free money that is available, such as 401(k) matches and credit card rewards, may sound boring, but are all tried and true ways to continue moving towards financial independence and early retirement.

And we used all of those methods to move a little closer to our goals during the fourth quarter.

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Solar Panels Don’t Produce Much Energy When They Are Buried Under Snow!

Solar Power
There really are solar panels under the snow!

We’ve had our home solar energy system for just over six months, and have now experienced both the best and the worst the sun has to offer homeowners.

Our system was installed just before the Summer Solstice in June. During the summer months there were a handful of long and sunny days when our system generated over 50 kWh of energy, which helped us build up a nice bank of solar credits to offset future bills.

In recent weeks, however, our energy production has plunged as we neared the Winter Solstice. In late December, a combination of limited sunlight and snowy weather meant we produced less than 1 kWh of power on six of seven days.

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Update: Chase Freedom Announces 5% Cash Back Categories for Q1 18

Financial IndependenceEarlier this year, I wrote about our decision to sign up for the Chase Freedom credit card.

So far it has been a Smart Financial Decision for our family.

We haven’t changed our spending habits to take advantage of the 5% cash back rewards Chase Freedom offers on rotating categories every quarter. But we have reaped the benefits of switching normal spending from our Fidelity Rewards card, which offers 2% cash back on everything, to our Chase Freedom card when we can earn 5% on purchases we would have made anyways. Chase Freedom offers 1% cash back on purchases that aren’t in the specific spending categories eligible for 5% cash back, so we still use our Fidelity Rewards card for most of our spending.

Since we started using the Chase Freedom card in the spring, our family has received almost $290 in sign up bonuses and cash back! Continue Reading

Smart Financial Decisions: Saving Hundreds of Dollars an Hour Making Phone Calls

Financial IndependenceIn today’s edition of Smart Financial Decisions, we’re writing about a simple, but incredibly effective, way to save significant amounts of money.

And almost all of us can find ways to use this skill.

It’s called picking up your phone and making a phone call.

As I’ve gotten more serious about pursuing financial independence and early retirement, I’ve used this skill more and more often.

This year alone I’ve made several phone calls that have saved the ROMT family well over $1,000.

Not a bad return for a couple of hours of “work”!

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