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018 | Go Curry Cracker | Capital Gains, Losses and The Roth Conversion Ladder

Introducing Capital Gains Harvesting

Podcast Episode Summary

  • Our guest: Jeremy from Go Curry Cracker
  • Jeremy and Winnie are living the geo-arbitrage life: currently in Taipei, Taiwan and then on to a four month trip to Europe
  • They are using travel rewards points to get nearly free business class flights from Taipei to Europe.
  • “Retiring in your 30s is simple but not necessarily easy”
  • The biggest contributing factor is saving a high percentage of your income
  • It’s easier to save a high percentage of your income when you have a larger income
  • Make unconventional choices to save a high percentage
  • 2nd Generation FIRE and how college costs can be lowered
  • Jeremy had $40,000 in debt when he came out of college
  • They have already opened a Roth-IRA for their son and used the income he earned from ‘modeling services’ for Go Curry Cracker
  • He used the 80/20 rule to look at where 80% of their spending was going
  • Sold his car and rode a bicycle
  • Winnie made it so her cooking was the best food in town and they never wanted to go out to eat
  • They spend approximately $2 per person per meal for delicious gourmet home cooked meals
  • Most of their entertainment was community based with friends where they weren’t spending money
  • How did he get started on his FI journey? He took the first 6 years to pay down his $40,000 in debt.  Didn’t take vacation, worked overtime to earn more money.
  • On his first vacation he realized he didn’t want to work forever and started formulating his plan
  • He set a 10 year plan and retired in 10 years plus 1 day from when he started!
  • What was it like when he actually quit his job?
  • The power of FU money and not needing to work plus how much more power it gives you while you are actually working
  • How is he investing his money? 100% of his money is in 2 index funds
  • Wait for compound interest to take hold so you can benefit over decades
  • Unpacking his article ‘Never Pay Taxes Again’
  • Harvesting Capital Gains and how it enables you to get up to $90,000 in tax free income each year and increase the basis in those funds so you are never paying taxes on the gains
  • Wash sale rules aren’t relevant to harvesting capital gains, only capital losses
  • Harvesting capital gains actually makes it easier to harvest capital losses in the future
  • They also do the Roth-IRA conversion ladder to effectively make their regular 401k tax free
  • Harvesting capital losses to offset other income
  • Avoiding the wash sale rules: Need to buy back another fund (example: Sell Total Stock Market Index fund and buy S&P 500 Index fund)
  • Hot Seat questions
  • Favorite blog: JLCollinsNH.com
  • Favorite life hack: credit card rewards points

Links from the show:

Books Mentioned in the Show:

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