What if I told you there was a way to contribute $10,000 less to your child’s 529 college savings plan while providing him or her the same amount in the end? Of course you’d want to take advantage of that opportunity if you could. Your child ends up with the same amount of money for college, and you have $10k more for your retirement. This isn’t a secret hack or pyramid scheme either. The idea came to me when I was reading about the concept of Coast FI in the financial independence community.
If you’ve made it this far that means you have a healthy emergency fund and have successfully paid off your high interest debt. Hopefully you have a plan in place to keep both of those victories in place and prevent sliding back into trouble. Now it is time to pay down moderate debt. A 4-8% interest rate may not seem like its high enough to worry about tackling right now. Some might argue that your money is better off in the stock market. I think it is critical to keeping up on the Path to Financial Independence.
I’m not entirely sure you are allowed to refer to yourself as a good southern cook if you can’t whip up some delicious biscuits to accompany your dishes. I don’t make the rules, I just make sure I can crush this Plaza biscuit recipe when I need to. Similar to how the baguette is sometimes seen as the mark of a good French baker, the biscuit is the benchmark food in the Southern culinary world. The ingredients are simple but it takes a good “biscuit hand” to pull them off.
When you get deep enough into the financial independence community, you are going to want to start building your own spreadsheets. Don’t get me wrong, the spreadsheets available out there for free are great. But sometimes you want something quick or the pre-built ones are just missing something you need. I have three essential personal finance formulas and how to use them.
Time to have a bigger emergency fund. Do you have at least 3-6 months of expenses saved in your emergency fund? If you do, congratulations on keeping a decent money for unknown bumps in the road. If you don’t, keep saving every extra dollar until you do. Keep asking yourself this question until you can honestly sleep well at night with the amount you’ve set aside for emergencies.
I love board games. Video games are great but board games provide a more tactile experience for me. There is just something about sitting at a table with friends, looking down at sea of opportunity on the board game, moving physical pieces around, and enjoying everyone’s reactions. They provide a social, community experience in a world of increasing isolation at our individual smart devices.
The best part is while you were sleeping on board games, they’ve been bringing the heat recently. I compiled a short board game gift guide for the financial independence enthusiast in your life.
Not everything in the personal finance world is pure optimization of assets through the use of beautiful spreadsheets. Don’t get me wrong, there are a lot of spreadsheets, and they are all beautiful, but sometimes decisions are emotional. Making some financial decisions for emotional reasons despite the math needs to be normalized. We like the quick “wins” of closing those smaller loan accounts early with the debt snowball method. It keeps us motivated to continue.
I’m not going to break any ground here telling you that high interest consumer debt isn’t good for your financial welfare. We all know that the first step toward a life of financial independence is to pay down high interest debt. Knowing the destination isn’t the same as knowing the directions for getting there however. There are several, very popular, methods for paying down debt at an accelerate pace we’ll look at later in the article so stay tuned.
Sure. “I was able to save $15,000 more in 15 minutes for retirement and you can, too.” Ugh, I know… I know. We all hate it when personal finance writers assume that just because they were able to do something then it should be easy for everyone else, too. That said, what I did was incredibly generic and could apply to a lot of people out there with a company-sponsored 401k.
Employer 401k Match: Step 7 on the Path to Financial Independence
Does your employer offer a 401k match with contribution program and do you contribute enough to get the full match? I hope if you are reading this you understand the importance of saving for retirement so I’ll skip that. What is more important here is saving for retirement with someone else’s money. The 401k match is essentially your employer giving you free money for retirement as long as you save too.