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Old 06-04-2007, 05:29 PM
139 posts, read 722,254 times
Reputation: 103


live below your means and save/invest
keep your cars a long time, and well maintained,
pamper yourself in small ways but don't splurge
learn to use money as a tool, not the end
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Old 06-04-2007, 05:55 PM
Location: Los Angeles, Ca
2,884 posts, read 5,180,643 times
Reputation: 2731
You've gotten great advice. I would add..

-Avoid big mistakes in life.

*Avoid CC's as much as possible. I don't think I've ever seen anyone with 10-15 CC's retiring early (maybe, but not likely). Maybe 2-3 CC's max for life, and that's it.

You can pay off your balance every month, but never go a step down from that. Don't get into interest rates, minimum payments, late fees.

*Avoid fads, bubbles, "the latest hot investment". Never take investment advice from the "experts". All the "experts" a few years ago didn't think there was a real estate bubble. These guys don't know anything.

*Avoid "experts" and gurus that will teach you the secret of success (for only three easy payments of $99).

They usually try to upsell you forever into $1,995 seminars and $9,995 "university" courses. "But what you really need is a $495 set of CD's or a $1,000 seminar".

*Never invest in anything blindly, without knowing much about it.

For example, you wouldn't go down to the local main street and invest $20,000 into a business that you didn't know anything about (and invest for 20 years, investing for the long haul). People do that in stocks all the time unfortunately.

*Maybe the biggest thing is avoiding overload and making it too complicated. Alot of people have turned simple advice into a huge industry. Seems like there's always another tip, "expert column", some "expert" on tv. There's an aweful lot of people out there telling what you need, how much money you need for this. I think I know my situation better than they do.

Much success!
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Old 06-04-2007, 08:02 PM
Location: Papillion
2,585 posts, read 9,544,524 times
Reputation: 890
Originally Posted by tigerjack88 View Post
All I will have left is a $4000 student loan bill, but zero savings, emergency fund and zero retirement saved....... thanks for the suggestions/advice
All great advice in here. A very practical book is Dave Ramsey's books. He has some unique ideas but does talk about saving, emergency funds, retirement, debt, etc. Good stuff.
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Old 06-04-2007, 08:32 PM
Location: New Orleans, LA
1,730 posts, read 3,141,238 times
Reputation: 2955
All great advice. Here's my take on this:

First, contribute the maximum to your 401K.

Then, divide your take-home pay into thirds.

One third pays for your rent or mortgage. If that isn't enough money for rent, then guess what? You need a roommate.

The second third pays for food, utilities, and everything else.

The last third is for your retirement effort. This is the fun part. The rest of this post explains what you do with it.

Start by using it to pay off your credit cards, and cut up all but one. That one must be paid off in full every month, using the second third, not this one.

Then, use the money you WERE using for minimum credit card payments, plus this third, to pay off your car loan and other loans.

Once you don't owe anything to anybody, let enough accumulate in your savings account for a down payment on a house. Then, buy a house that will require mortgage payments that fit in your budget (less than 1/3 of your take-home pay) and use the third of your money devoted to retirement to make extra payments to the principal. Pay off the house as early as possible.

At this point, you owe nothing to anybody, you have a paid off house, and all the money you used spend on paying off loans, the third of your pacheck you spent on your mortgage, plus the third of your paycheck devoted to your retirement, all go to building your nestegg. Don't forget to put the maximum in a Roth IRA at this point.

If you invest wisely in mutual funds, over the long run your nestegg will increase more from your investment earnings than from the money you are pouring into it.
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Old 02-17-2008, 11:15 AM
Location: Tampa, FL
27,798 posts, read 26,217,684 times
Reputation: 14611
Originally Posted by tigerjack88 View Post
I would like to get some advice/suggestions from retirees (recent and not) on how one could retire early. What I would like to know is: what one did in order to retire early (before retirement age 62)? I am a single 28 year old female and will begin working in government (county-sector) and would like to know what to do in order to retire in 15, 20,25 years. I don't plan on having children---any time soon anyway, nor a husband . I have a couple of suze orman books and a david bach book...Any advice and stories are helpful. Thank you

Off the top of my head -

1. Don't buy a lot of cars - and buy a relatively new "used" car and drive it til it dies.

2. Maximize 401(k) and Roth, TSP.

3. Don't have a credit card balance. Don't buy stuff you don't really need.

4. Gov't service allows you to retire at a relatively early age with a pension, right? (55 yrs)?

5. Live in spartan housing -nothing luxurious.

6. Don't buy new clothes too often.

7. Stay out of Starbucks.
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Old 02-17-2008, 08:24 PM
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
22,587 posts, read 39,962,822 times
Reputation: 23724
good advice so far !!

What is the rate on student loan? I wouldn't pay it off early, unless it is greater than 7%, (My kids loans were consolidated at 2.7%, they are in no hurry to pay those off!) your current $$ are worth more in an investment, as inflation and any tax deduction reduces your cost of student loan $$

I would be pouring $$ into retirement with current equity market low, but in general, systematic (monthly / every paycheck) savings into a growth portfolio will serve you well.

Listen to Bob Brinker (free 6 hrs / weekend of radio investment advice) Also Dave Ramsey has good advice, but not too specific on investments. Do the "fool's school" at Fool.com. Don't get to crazy with investments, just select a few funds or ETF's that are balanced and have an intelligent place to keep your cash when you need to be out of market.

Take advantage of any matching funds, and max your ROTH IRA early in the year, and keep it invested !!

Consider real estate. I made it ~ 30% of my net worth and it is a good balance of equity. As a SF would buy a NICE Multi family place, 4 plex or so. (upscale, where you will get retiree's and wealthy singles, not COLLEGE Kids!!) I consider a single family residence too high of a cost to tie up capital (tho I have one...) but I advise my 20 something kids to buy multi-family or commercial office / retail buildings (less renter hassle, but tougher to buy). One reason for investment property at a young age is that you have a good chance of getting it paid off and just imagine... when you retire (or before) you will have replacement income to the tune of your exit wages and NOT have to go to work to get it!!! (think, collecting pay checks while enjoying the beach of Tahiti) It is much better to have your assets work FOR you. I haven't found a home to do much of that, though fortunately it has increased in value (not always the case). I strictly buy Real Estate that is under valued and is desirable enough to re-sell if needed. Location, Location, Location !!! (near parks, view, waterfront...) you'll be very glad you were picky in your selection. Buying RE is very stressful when you sign the papers !!! I bought my first house at age 19, yikes $16,000 !!! and $128.84 / month payment. I was making $2.35 hr and scared to death I'd loose it, as my folks had just lost there VERY nice home due to health problems and bad market. I had to sell my car to get down payment, and have been driving 'beaters' ever since Current car is 1 yr newer than the one I sold 33 yrs ago to buy the house!! This car cost $35, gets 50 mpg on free fryer grease.

Live cheap, (shop wise, travel via specials, use guest homes instead of hotels, volunteer as usher to get 'free' concert and entertainment tickets, use radio media, library, walk instead of drive, no club memberships / cable TV, don't eat one or more days / week (2 seems to work for me)...) have fun, it's very easy, but requires discipline !! I have also always (since 18) practiced disciplined giving as there are so many needs and it makes you spend wiser and be more content.

Good luck
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Old 02-17-2008, 10:34 PM
Location: Tampa, FL
27,798 posts, read 26,217,684 times
Reputation: 14611
Very interesting post. I never invested in real estate - always tempted, but never had the courage to take the risk -

Brinker is interesting to listen to - the Dolans have free podcast every weekend. Wished Brinker did too. I once had a subscription to his site, but dropped it (to save $$$).

The only thing I disagree is your last paragraph about living to much on "the cheap" - still would recommend that a person reward themselves (like going to a concert instead of working a concert) for working hard.
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Old 02-18-2008, 01:43 AM
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
22,587 posts, read 39,962,822 times
Reputation: 23724
I may reward myself by buying a PoGo "radio-your-way' to record Brinker / Prairie Home Companion, Science Friday....Hi Speed internet would be another option if it was available here in the boonies. This pay by the byte super slow-modem is killing me. I don't do TV, so maybe Satellite radio would work, but I don't much care for monthly fees, I still get by on $10/wk spending money, since I use free grease for fuel.

I have season tickets (student) to Baroque Orchestra, and noted last night that the ushers had great Aisle seats, so I will volunteer next season, it only costs an extra hour of time, and you get to attend rehearsal and meet up with artists. Being a 2 hr drive to get there it won't be a big deal. Time is very cheap when you retire pre-50, and go back to school. (it beats work )
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Old 02-18-2008, 03:25 AM
Location: Tampa, FL
27,798 posts, read 26,217,684 times
Reputation: 14611
I'll probably be retiring at 46 yrs of age. Might go to work again in ST Pete/Tampa area if I'm bored or feel that I'll need $$$$ to get to my life expectancy. I do like your style.
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Old 02-18-2008, 09:31 AM
Location: DC Area, for now
3,517 posts, read 12,052,621 times
Reputation: 2141
All good advice. If your student loan doesn't have a high interest rate, you should invest in the 401k as soon as possible. The earlier you start, the better. Try to buy your abode as soon as possible. I don't have any experience in multi family investing, but some here have and have done well with it. It does sound like a way to make someone else pay for your housing with little money on your part and that can be a good strategy.

You can live extremely spartan and that will save you a lot of money, but you do want your 30 years before you can retire to be worth living. Yes, pets do cost money but kids cost more. It really depends on what you want out of life and what is worth the expenses.

The smartest thing is to consider alternatives and your goals for each expense. Get one of the money programs and keep track of all your expenditures so you know where the money is going. For example, a Starbucks habit can cost $800-2000 a year. Making your own coffee gets you the same thing for much less cost.

Keep your health. Exercise, keep your weight stable, eat healthy, take a wary eye on pharmaceuticals for the healthy. It costs a lot less than health care and your life is better. It is very smart to be thinking about this at your age.
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