Browse Month: July 2017

Lessons on Financial Independence from My Visit to Sears

SearsLast week, I had the opportunity to visit a Sears store for the first time in about a year.

Since my previous visit, I’ve read many articles about the decline of traditional retailers, particularly Sears, but this represented an opportunity to see how things were going at Sears with my own eyes.

As someone in his mid-40s, I can remember when Sears was one of the premier companies in the United States.

Sears was founded in 1886 (I can’t remember that!) and Sears Roebuck & Company was a component of the Dow Jones Industrial Average from 1924 through 1999. Growing up, the Sears Wish Book was required reading for my siblings and I, as it provided an almost unimaginable list of options to hope for on Christmas Day. Sears was still the largest retailer in the country when I headed off to college, and at the time also owned Allstate Insurance Company, stock brokerage Dean Witter, the Discover card, and real estate company Coldwell Banker, in addition to many other businesses. The Sears Tower in Chicago was the tallest building in the world for most of my life. Even today, brands associated with Sears, such as Craftsman, DieHard, and Kenmore, are still well-known to many Americans.

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Smart Financial Decisions: Thinking About Percentages

PercentagesThose who have read Retiring On My Terms before know I tend to focus on the numbers while charting our course towards financial independence.

I’ve posted in the past about the large impact small decisions can have over time, and we have made several changes to our daily habits since we actively started down our path to FIRE.

As I read posts from others who are more focused on frugality and minimalism, I always learn something new. I can’t honestly say I’ve implemented everything I’ve read, but even ideas that seem outlandish still encourage me to review my own decision-making, and force me to think about things differently.

As my thinking has changed, one thing I’ve started doing is evaluating my consumption in terms of percentages.

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Smart Financial Decisions: The Best Purchase Of Our Frugal Vacation

Retiring on my terms

Last week, I wrote about our decision to spend less than half of what we spent last year on our family vacation this year.

A year ago, we stayed at a luxury oceanfront resort.

This year, we stayed at a nice inn, which was about half an hour away from the public beaches.

There were many perks at the luxury resort last year, one of which was that a staff member would help bring your chairs and other belongings down to the beach, and set up a large beach umbrella or portable tent for you.

While this was nice, it also made me a bit uncomfortable. I’m a grown man, in reasonably good shape, with a wife and two children. I don’t need someone to carry chairs or set up a tent for us.

I know some people are all about the service, but I am all about self-sufficiency.

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Investing 101: The Basics

As someone who has been investing for decades, I often assume every reader has a similar background to mine.

But in reality, that’s not the case.

This is a good thing, because if every potential reader had the same experiences, knowledge, and perspective as I, there would be no reason for anyone to read anything I write!

In the first couple months of Retiring On My Terms, we’ve discussed a wide variety of topics:

InvestingGarage Sales.

Solar Energy.

401(k)s.

The cost of long commutes.

And even old water heaters.

Today I’m beginning a series of posts that will hopefully help build a foundation of knowledge around personal finance and investing for those who are newer to these topics.

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Just Because I Can Afford It, It Doesn’t Mean I Should Buy It

Like most readers pursuing financial independence, I work hard.

Fifty to sixty hours in the office each week, in a demanding and oftentimes stressful career, plus additional time working from home at night and over the weekend.

More than five hours spent commuting to and from work every week.

In addition to the time I am now devoting to writing for and building Retiring On My Terms.

Life is very busy, and I make a good living.

So I should reward myself, right?

After all, I deserve it!

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The Hidden Costs Of Solar Energy

Solar EnergyLast month, I wrote a series of articles about our decision to purchase a home solar energy system, and my belief it will ultimately help us on our path towards financial independence and early retirement.

The first post outlined our decision-making process.

The second post discussed our solar installation.

And the third highlighted the initial performance of our solar panels.

Today, in an effort to share some additional information on the topic, I want to identify some of the potential hidden costs to going solar I found useful to consider, even though they didn’t show up in the quote from our local solar energy company or most of the research I did on my own.

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Quarterly Financial Scorecard: Q2 2017

Early Retirement
Could early retirement really be just four years away? We still have a lot of work to do!

Last week, I outlined how I plan to measure our progress during our quest for financial independence and early retirement.

Today, we’ll open the curtain into our finances for the first time, and share where we stand in relation to our Net Worth, 529 Account Funding, and Passive Income goals as of June 30, 2017 – just four years before our target FIRE date of Friday, July 2, 2021.

I. Net Worth: 73.1% of Goal

Our net worth declined by 1.0% during Q2 2017. On the surface, this was a poor performance, as the S&P 500 was up 2.6% during the quarter. Not all of our assets are in the stock market, so the comparison is a bit unfair, but we’d still normally expect our net worth to rise with a strong stock market bolstered by additional savings and investments.

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How I’m Measuring Our Progress Towards FIRE

Early RetirementWhile there are many ways to measure progress towards financial independence and early retirement, I tend to focus on the numbers more than the less tangible aspects of the journey.

As we continue down our path to FIRE, I will post a Quarterly Financial Scorecard every three months, documenting our progress along the four dimensions I am measuring.

But before posting our Quarterly Financial Scorecard for Q2 2017, I want to outline what we are measuring during our quest for financial independence:

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Making Sense of the 4% Rule

4% RuleIt doesn’t take long for anyone researching retirement to learn about the 4% rule. There have been hundreds of articles written about it, many of which provide incredible detail around the history of the 4% rule, the mathematics behind it, and special considerations for those pursuing early retirement.

I’m not going to reinvent the wheel here today.

Instead, I’m going to share some basic information about the 4% rule, include links to several resources that provide much more information for those who are interested, and discuss our potential use of the 4% rule on our path towards early retirement and financial independence.

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