047 | The Cult of Home Ownership & Crushing Geoarbitrage | Millennial Revolution

047.Millennial Revolution

Today we have Kristy and Bryce from Millennial Revolution on the podcast to discuss home ownership, international geographic arbitrage and much more…


In Today’s Podcast we cover:

  • A discussion with Kristy and Bryce from Millennial Revolution
  • They initially were contemplating buying a house and were shocked by the process
  • This is what led them to finding the Financial Independence community
  • Home ownership seemed like a “cult” to them
  • What did their financial life look like before finding financial independence and how did they save so much money previously?
  • Who might be naturally included to FI and how everyone can be open to it
  • FI opens up creativity that you otherwise wouldn’t have the time for
  • Voicemail from David from Canada
  • How difficult it is societally to not purchase a house
  • You need to do the math behind home ownership and don’t succumb to the ‘fear of missing out’
  • All the other costs that are involved in home ownership that eat into your paper gains
  • A house is not an investment, it’s a place to live
  • The power of compounding and the Rule of 72
  • How would someone do the math to compare renting versus buying?
  • The 1% rule
  • Introducing leverage into the scenario of buying a home
  • What do they invest in? Low-cost index funds
  • How often they rebalance their portfolio and how they came up with their 60/40 split
  • It is less expensive for them to travel the world than live in Toronto
  • Their annual spending their first year of travel was $40,000 but they were able to cut that to roughly $30,000 in year 2
  • How they believe everyone could live the same lifestyle if they were willing to break their mental block with owning a home
  • How would they recommend people get started with international travel and geo arbitrage?
  • Budget airlines and bus companies help them travel throughout Europe for a fraction of the expected costs
  • What do they do with lodging when first visiting a city?
  • The ‘secret’ location they’ve found in London to stay for a fraction of the cost
  • How nobody else in the world worries about health costs like Americans do
  • How much could you reasonably spend for a year of living in Thailand
  • The little enclaves of expats that exist throughout the world where they’ve found to live for less
  • Their summarized advice for David from Canada
  • Hot Seat Questions
  • They actually have a financial advisor, but they don’t outsource their knowledge to someone else

Links from the show:

046R | Selectively Hardcore

046R Selectively Hardcore

In today's podcast we discuss our takeaways from Episode 46 with Ms. ONL from Our Next Life plus community feedback and voicemails and a discussion of travel rewards.


In Today’s Podcast we cover:

  • A recap of Episode 46 with Tanja from Our Next Life
  • Brad and Jonathan are on their way to Fincon – the annual financial bloggers conference
  • Jonathan’s upcoming trip to South Africa with his family using travel rewards points
  • Tanja’s reveal of her identity after being anonymous for the entirety of the blog’s life
  • What do you want out of life and how are you going to approach that question in the leadup to FI?
  • The ‘internet retirement police’ and people making money in early retirement
  • ‘We are some of the luckiest people in human history’ as Tanja described
  • The safety Mr. and Mrs. ONL have built into their FI plan
  • The different stories and plans our various guests have and how there is no ‘one size fits all’ plan for Financial Independence
  • How they are selectively hardcore about certain things like their heating bill
  • Corrections and feedback from episodes 43 and 43R
  • Updates on Mega Backdoor Roth options including feedback from William
  • Brad’s feedback on Keith from The Wealthy Accountant’s thoughts on the Mega Backdoor Roth and the Roth IRA conversion ladder going away
  • Discussion of Roth versus traditional IRA and marginal tax brackets plus info on the Earned Income Tax Credit
  • Email from Giselle from our ChooseFI community and her question about spending now versus the future and frugality versus enjoyment
  • Brad and Jonathan’s response to Giselle about how we view the path to FI as a positive and gives us more control over our lives
  • Giselle’s question about using travel rewards points for a 2 week trip to Europe and when to get started and how to avoid issues with mileage expiration
  • Voicemail from community member Joel listing all the incredible changes he has made since finding the ChooseFI podcast
  • Itunes review and book giveaway

Links from the show:

046 | Our Next Life | The Reveal | Are you Ready for Early Retirement?

Our Next Life | The Reveal | Are You Ready for Early Retirement

In today's podcast we have a wide-ranging conversation with Ms. ONL from Our Next Life on her decision to stop being anonymous on the blog to what their journey looked like to FI plus what they expect life to be like after FI and much more.


In Today’s Podcast we cover:

  • A financial independence discussion with Ms. ONL from Our Next Life
  • The big reveal: Their names are Tanja and Mark
  • What does it feel like for them to come out behind the veil of anonymity?
  • Why have they been so strict about remaining anonymous?
  • They both were previously in political consulting
  • They live in North Lake Tahoe in California and lived previously in Los Angeles
  • Health care has been a focus on their blog and they both actually worked on health care policy with their jobs
  • Tanja has been able to stockpile over 1.3 million United miles plus Marriott and Chase points
  • How does their budget in FI compare with the prior 12 months?
  • How do they view the concept of early retirement?
  • How they can pursue the aspects of their jobs that they still enjoy
  • How is early retirement different than working for yourself?
  • One of the best parts of early retirement is that you can try so many different things
  • Their friends and family are extremely supportive of their early retirement plans
  • Finding their ‘why’ behind early retirement
  • A discussion of how silly the notion of being “bored” in early retirement truly is
  • The Endless Winter: Following the snow to ski for an entire winter
  • How they try to save money on their heating costs
  • How difficult the transition could be from working to not working and to mentally prepare yourself in advance for life after retirement
  • How to mentally prepare yourself for future situations with “disaster drills”
  • The value of finding progress in difficult things in life
  • The questions you need to consider when pondering early retirement: 1) How will you support yourself or your family without a job?
  • They do not plan to tap their tax deferred items before 59.5
  • How they projected the amount they need to reach Financial Independence
  • Question 2) What is your backup plan for dealing with financial emergencies?
  • The value of insurance and especially umbrella insurance
  • Question 3) How will you get healthcare?
  • How your income impacts your health care subsidies and the consideration of FI strategies
  • Question 4) How will you keep your body and mind healthy?
  • What will a day look like for them in retirement?
  • The importance of community in maintaining a healthy balanced life
  • The Hot Seat Questions

Links from the show:

045R | The Journal

045R The Journal

In this podcast we discuss our takeaways from Episode 45 with JD Roth of Get Rich Slowly, including the big news that he just purchased GRS back, as well as our frugal wins of the week and the elegance of simplicity.


In Today’s Podcast we cover:

  • A review of Episode 45 with JD Roth from Get Rich Slowly and Money Boss
  • Jonathan’s frugal win of the week on purchasing a new stove/oven
  • What is the utility of Jonathan’s new oven over a standard oven?
  • Jonathan’s insourcing to install the oven himself
  • Brad’s frugal win of the week: Laura stained the deck on the back of the house
  • JD’s big news of buying back Get Rich Slowly
  • How JD’s story helped change the world for so many people and how much impact he has had on potentially millions of people
  • JD’s impact on Brad’s life with travel rewards
  • What a unique point in time to be able to start a blog for so little money and the positive impacts you can experience
  • The power of the blog is in the story of the blogger and that individual’s personality
  • JD’s concept of the internal locus of control and how you can direct your life
  • Don’t complain about the forces that are impacting your life – take control
  • JD’s concept of having to do the work and that there are no shortcuts
  • How strategy and cost-benefit analysis factors into your actions and goals
  • What’s not worth putting the work in for? This is as important strategy-wise as picking what you do want to spend your time on
  • Investment strategies of VTSAX versus other options, and Brad’s thoughts on the cost-benefit analysis of spending time trying to beat the market
  • Part of the strategy is determining where to put your time and effort in life and investing
  • It’s all about taking action in investing and life and how it separates successful vs. unsuccessful people
  • The elegance of simplicity in getting people to take action
  • A future roundtable with people of different opinions on investing
  • Voicemail from Melissa on how she “channeled her inner Laura” in saving time and money on cooking
  • Laura’s tips on how to cook more efficiently
  • Jonathan’s experiment with his first vegetarian meal
  • Itunes reviews and book giveaway

Links from the show:

Books Mentioned in the Show:

045 | JD Roth | Get Rich Slowly | Breaking News | Full Circle

045.Get Rich Slowly

Today we discuss JD Roth's backstory behind his financial journey, Get Rich Slowly and Money Boss, plus JD's philosophy AND a very special announcement…


In Today’s Podcast we cover:

  • A discussion with JD Roth from Money Boss and Get Rich Slowly
  • How JD impacted Brad’s life and put him on the trajectory to becoming a travel rewards expert
  • JD’s backstory and how he found the personal finance community
  • JD started Get Rich Slowly to document his process to clawing out of $35,000 worth of consumer debt and becoming financially literate and successful
  • JD started his ‘credit card habit’ in college
  • Any actionable tips the audience could take away from JD earning a scholarship to college?
  • JD focuses on being self-directed with an ‘internal locus of control’
  • JD started a blog before the word blog even existed and started his first webpage in 1994 and his first web journal in 1997
  • JD’s plan to get out of debt in 3 years and the article he wrote called ‘Get Rich Slowly’
  • April 2006 was when Get Rich Slowly started
  • JD was looking for a ‘magic bullet’ but quickly realized he needed to put in the effort and spend less money
  • Dave Ramsey’s Debt Snowball and how it helped JD succeed psychologically
  • JD as an ‘accidental personal finance expert’ and how that journey progressed
  • The audience and community around Get Rich Slowly helped make it a great site and inclusive
  • JD’s frustration with the thought that there’s a “right” way to go about things in the personal finance world
  • Action is the number one thing that separates successful people according to JD
  • The methodology behind financial independence according to JD: The Six Stages of Financial Freedom
  • Your level of control increases as you progress down the path towards financial independence
  • When JD personally progressed through the six stages
  • How does JD spend his days and what is his philosophy?
  • How JD sold his comic book collection and made $28,000 which funded their RV trip
  • JD’s insight on the future of the financial independence movement
  • Hot Seat Questions
  • JD’s big announcement about Get Rich Slowly

Links from the show:

Books Mentioned in the Show:

044R | The One Way Ticket

044R - The One Way Ticket

Today we discuss our takeaways from Episode 44 with Brandon Pearce from Pearce on Earth plus feedback from the community and our thoughts on international travel with our families.


In Today’s Podcast we cover:

  • A discussion of Episode 44 with Brandon Pearce from Pearce on Earth
  • Jonathan’s frugal win of the week by having a potluck dinner and a movie in the backyard for his friends and neighbors
  • Jonathan is on a 3-day fast and his explanation
  • The importance of mentally anchoring when undertaking something difficult
  • Jonathan wanted to prove to himself that he could do it and to help with his impulse control
  • Brandon realized early that you don’t have security as a 9-5 employee
  • The power in your life shifts when you start saving money and that margin increases with each paycheck
  • The concept of ‘burn the boats’ in motivating you to success
  • Jonathan’s thoughts on safety vs. burn the boats
  • How your business can take over your life if you let it, so you need a work-life balance
  • Where are the pain points in your life and how can you make them better?
  • Brandon’s lightbulb moment when you have that first sale
  • They knew there was more to life that they could experience outside their ‘bubble of life’ by travelling the world
  • Jonathan’s story of visiting an international food store in Richmond
  • Looking for areas of fear and discomfort in life and leaning into them
  • Finding community both abroad and here in the United States
  • Brad’s thoughts on taking an international trip with his own family and what is potentially holding them back
  • Brad tracking his time and will report back with his progress next week
  • The value of telling other people about goals you intend to hit and how it keeps you motivated
  • Also, the value of telling a ‘story about yourself’ and how that will keep you motivated to do what fits that story
  • Voicemail from Vicky about getting out of their 9-5 lives and pursuing slow travel with their two kids plus how they used 120,000 miles to get 4 one-way tickets to Europe for only $20
  • The “one way journey” of life
  • Feedback from Andrew on the episodes
  • Different types of learning opportunities for your children
  • Voicemail from Kevin how he explained FI to the HR department at his company and how motivated it made him to keep going down this path
  • Itunes review of the week and book giveaway

Links from the show:

Books Mentioned in the Show:

044 | Brandon Pearce | Into the Wind

Into The Wind

Today we discuss how Brandon Pearce went from a call center job to being a full time entrepreneur, traveling the world with his wife and children and how he started the Family Adventure Summit.


In Today’s Podcast we cover:

  • Episode 44 with Brandon Pearce, who was recommended to us by Andrew from the ChooseFI community
  • Discussion of geo arbitrage, starting your own business and designing your future all wrapped up in one person
  • Brandon realizing that you have no control over your future as a regular employee and it started him thinking about getting moving with his own business
  • His software for organizing piano lessons was what led to his business
  • How he got his first sale and realized this could be a successful business
  • How Brandon considered making this a full-time venture and that inflection point where he took the leap
  • Did Brandon contemplate not going full time with his software or was this a slam dunk decision?
  • The value of hiring from inside your own community to find someone who is passionate and knowledgeable
  • How Brandon wouldn’t be happier or more fulfilled with more ‘stuff’
  • Was the plan for this to be a ‘lifestyle business’ originally?
  • They replaced a focus on stuff with a focus on growth, travel and service
  • Their six week “test trip” to Panama as a family
  • Looking at life through your children’s eyes
  • How difficult it was to replicate this experience in the United States
  • Travel as one of the biggest catalysts for growth
  • How liberating it was to not have any of their stuff on the trip to Panama
  • Their first long-term trip was to Costa Rica and they were there for 1.5 years where their daughter was born
  • How do you find a community when travelling abroad?
  • Their current location in San Miguel de Allende in Mexico and how close the community is there
  • Schooling types: Homeschooling, world schooling and un-schooling and an explanation
  • They follow an interest-led learning approach with their children to inspire the love of learning
  • What do you tell someone who is afraid to take the leap to family travel?
  • Slow travel has the ability to be transformative and immersive
  • Questions about safety and health care in foreign countries
  • A discussion of health care in the countries Brandon has lived in and how inexpensive it is
  • Brandon’s time tracking experiment
  • The 1st annual Family Adventure Summit
  • Documentary: Into the Wind about families travelling the world
  • Hot Seat Questions

Links from the show:

Books Mentioned in the Show:

043R | Mega Backdoor Roth | Should I Ever Consider Using the Roth?

Mega Backdoor Roth

In this podcast we discuss our takeaways from Episode 43 with Fritz from the Retirement Manifesto plus an in-depth discussion of the Roth IRA conversion and Mega Backdoor Roth, and taxable income scenarios for retirement contributions.

 In Today’s Podcast we cover:

  • Our big takeaways from Episode 43 with Fritz from Retirement Manifesto
  • Brad as a ‘Mystery Reader’ for his daughter’s class plus their trip to Natural Bridge State Park and a FI lesson for his daughters
  • How to tackle drawdown strategies and how that opened our eyes
  • The concept of balance that Fritz brought up in Episode 43
  • How we each have a different path to Financial Independence and we have to find what we each value and how much safety we require
  • How important the math is, but also how the personal side is an important part of the equation
  • Jonathan’s decision to pay off his student loans early and how this may not have been optimal mathematically, but was the “right” decision for him
  • Feedback from the audience on the episode, but specific points from Danny
  • Questions surrounding inflation on your safe withdrawal rate and early retirement
  • Feedback from the audience about delaying social security
  • The distinction between the Roth IRA conversion and the Mega Backdoor Roth IRA
  • The tax issues surrounding the Roth IRA conversion

 

Practical Application of the Mega Backdoor Roth

  • Vishal and Brad share the nuances of trying to navigate the Mega Backdoor Roth: They need to allow for after-tax contributions and in-service distributions/withdrawals
  • Explanation of the Mega Backdoor Roth
  • Email from Zac about the value of using pre-tax or post-tax retirement contributions when you’re already in a low tax bracket
  • Where is the line where we’d consider putting into a pre-tax or post-tax retirement account?
  • A scenario of someone with a $25,000 income and where they’d fall in the tax brackets and how to lower that
  • A scenario of an individual with a $60,000 gross income and what they should consider with their retirement contributions
  • How would Brad and Jonathan choose if they were in this situation?
  • Itunes reviews and book giveaways

The Vault is live

Links from the show:

Books Mentioned in the Show:

043 | Drawdown Strategy | The Retirement Manifesto

In this podcast we have a far-ranging conversation with Fritz from the Retirement Manifesto about retirement drawdown strategies, his ‘buckets' system, and his upcoming retirement.


In Today’s Podcast we cover:

  • Retirement drawdown strategies with Fritz from Retirement Manifesto
  • How Fritz focuses on what life is about after retirement such as how you’re going to spend your time
  • Fritz is 9 months away from retirement himself
  • A background on his story in corporate America and his path to FI and early retirement
  • The difference in perspectives between retirement dates and savings rates between the FI community and the population at large
  • What would Fritz’s path have looked like if he found the FI community decades earlier
  • Fritz stayed with the same company for 32 years and has a traditional pension
  • Where did his interest in retirement spreadsheets and the blog come from?
  • How writing a blog helps develop and formalize your own thoughts and plans
  • What to consider when building your own retirement drawdown strategy
  • The Three Bucket Strategy for retirement drawdowns and how Fritz separates his own holdings by these buckets
  • What a simplification strategy looks like and how to avoid taxation with this simplification
  • How you can create a net neutral taxable position by specifically identifying losses and gains to sell when trying to simplify
  • How Fritz plans to use Roth conversions while he is in a zero-income position for a 2 year period and pay $0 in tax on the conversions
  • Explanation of the Mega Backdoor Roth and how Fritz is utilizing it
  • The equity to bond split that Fritz uses plus how to consider asset allocation and risk
  • Why does Fritz use a 60/40 Stock to Bon split when he has a pension and social security coming?
  • Why Fritz believes you shouldn’t take more risk than you have to
  • Fritz’s thoughts on delaying a pension and social security to get a guaranteed return
  • A hypothetical early retiree example and how Fritz would think through this example and advise them
  • The uncertainty of health care in early retirement
  • How they can track their annual spending by putting money into “Bucket 1”
  • What annual tasks do they do with a ‘year in review’?
  • The variable approach to withdrawal rates and flexibility
  • The value of protecting your Roth accounts to let them grow as long as possible
  • Life insurance policy discussion
  • The flexibility to take fun seasonal jobs if you wanted an adventure
  • Health Insurance and long-term care insurance discussion
  • Hot Seat Questions

Links from the show:

 

We were able to join the Blog Chain and this is our joint venture contribution with Retirement Manifesto

Anchor: Physician On Fire: Our Drawdown Plan in Early Retirement
Link 1: The Retirement Manifesto: Our Retirement Investment Drawdown Strategy
Link 2: OthalaFehu: Retirement Master Plan
Link 3: Plan.Invest.Escape: Drawdown vs. Wealth Preservation in Early Retirement
Link 4: Freedom Is Groovy: The Groovy Drawdown Strategy
Link 5: The Green Swan:  The Nastiest, Hardest Problem In Finance:  Decumulation
Link 6: My Curiosity Lab:  Show Me The Money: My Retirement Drawdown Plan 
Link 7: Cracking Retirement: Our Drawdown Strategy
Link 8: The Financial Journeyman: Early Retirement Portfolio & Plan 
Link 9: Retire By 40:  Our Unusual Early Retirement Withdrawal Strategy
Link 10: Early Retirement Now:  The ERN Family Early Retirement Captial Preservation Plan
Link 11: 39 Months: Mr. 39 Months Drawdown Plan
Link 12:  7 Circles:  Drawdown Strategy – Joining The Chain Gang
Link 13:  Retirement Starts Today:  What’s Your Retirement Withdrawal Strategy?
Link 14:  Ms. Liz Money Matters:  How I’ll Fund My Retirement
Link 15a:  Dads Dollars Debts:  DDD Drawdown Part 1: Living With A Pension
Link 15b:  Dads Dollars Debts:  DDD Drawdown Plan Part 2:  Retire at 48?
Link 16:  Penny & Rich:  Rich’s Retirement Plan 
Link 17:  Atypical Life:  Our Retirement Drawdown Strategy
Link 18:  New Retirement: 5 Steps For Defining Your Retirement Drawdown Strategy
Link 19:  Maximize Your Money: Practical Retirement Withdrawal Strategies Are Important
Link 20:  ChooseFI:  The Retirement Manifesto – Drawdown Strategy Podcast