It ALL worked. All of it.
Connie is a member of our community who responds to these emails frequently and she just sent in the most massive ‘wins’ email. This needed to be featured front and center in the newsletter:
It ALL worked. All of it.
When my husband passed in 2021, I needed to make some moves – some fast and some slow. I needed to wait until it all proved itself out over these last 3 years before I could write.
All moves were aided by different episodes of ChooseFI, and I NEVER would have been aware had it not been for your amazing podcast.
SELF-EMPLOYMENT: My business is a single-owner LLC, but I still file as an S corp from when I had employees so that I can pay myself wages as a W-2 employee and take the rest as an owner distribution.
What that enabled me to do:
1. We hacked the FAFSA for college. Both daughters (twins) start college in fall of 2024 and both are receiving max benefit from both federal and state aid! College will be debt-free! This will save our family $170,000 over the four years.
2. We hacked the ACA for health insurance. I worked closely with my CPA to keep our MAGI under the cliff for max benefit. We pay $33 a month for a family of 3 with an awesome silver plan! And the business pays my premiums, which is a tax reduction for the business and keeps me from having to bring extra income home taxed to pay the premiums and raise my MAGI.
3. I did my first Roth conversion this year. See above for working closely with my CPA. It was a lot of work but we did it without messing up the above two hacks.
4. The business also contributes to my retirement plan with a generous match, which also keeps the business taxes lower.
More FI:
5. I have been debt-free for years, but I knew there was more after ‘baby step 7’. I am a Dave Ramsey fan and following his plan truly saved my family’s finances. If I hadn’t followed everything he said, my husband would have had millions (no exaggeration) in medical debt and we would be bankrupt.
That being said, this past year, I signed up for two credit cards for the travel rewards. One of my daughters and I are going to Japan this summer, and my bougie airline ticket was FREE! $2,800 saved!
6. I joined a local ChooseFI meet-up group and am being intentional about building friendships based on common interests and not just proximity. We meet at each other’s houses to foster friendships and not just participate in a group.
7. I opened Roth IRAs for both my daughters at age 14. They are now Coast FI at the ripe old age of 18!
8. I was able to generously give in a FI manner by donating appreciated stock (and not paying taxes by selling them). Two birds, one smart FI stone!
Still in progress:
I just met with a fee-only advice-only RETIREMENT planner. I believe I am FI right now but want to retire Fat FI so that I can continue to be generous and no longer pay an AUM planner.
Thank you, ChooseFI, because all of these FI wins are helping me to craft the LIFE I want to live. I am grateful for all the knowledge you share to enable us to ACT!
Very gratefully,
Connie
Quarter 1 Net Worth Statement
Every 3 months I take 5 minutes to update my net worth spreadsheet and I think this is the most important thing you can do to track your finances.
The 1st quarter of 2024 just ended and here’s your reminder to update your net worth spreadsheet.
If you haven’t done this before, it’s really simple:
- Log into each bank/brokerage account you own and write down the current balance
- Add those balances together with the market value of any real estate or other significant assets you own. This makes up your Total Assets
- Write down all debts you owe including mortgage, credit, student loans, etc. and add them together to get your Total Liabilities.
- Total Assets minus Total Liabilities = Net Worth
Track this quarterly and watch this amazing journey to FI unfold before your eyes!
Where Subtracting Adds More
I found a wonderful article on the Becoming Minimalist site called ’30 Areas of Life Where Subtracting Can Add More.’
As they said in the article, “The path to a richer, more satisfying life isn’t always found in adding more. Often times, the path to a richer life can be found in subtracting—in removing the things that no longer serve us.”
This is an article worth reading, but to get your brain moving in the right direction, here are some of the areas that stuck out to me:
- Clothes: Instead of looking at a packed closet, why not limit what you own to things you truly love to wear?
- Paper Clutter: Go digital wherever possible! I’ve recently taken on the project to scan every important piece of paper in my filing cabinet and to shred the rest.
- Unused Apps and digital clutter generally: I removed apps from my phone and organized my computer’s main desktop so I don’t have dozens of files littering my screen.
- Over-Checking Emails: This is a hard one for me, but would have a massively positive impact on my life.
- Negative Self-Talk: This is something that plagues most of us and reducing this negative self-talk would be a significant step in the right direction for our mental health.
ChooseFI Community Taking Action This Week
My 1% better is finally achieving a 25% increase in pay from my current employer. I had begun asking for a salary increase approximately 15 months ago, citing my contributions to the institution, along with my years of experience. Apparently I had capped out the salary max for the position I held and in February I was asked to step into a newly created position which offered a 25% increase from the salary I made.
Along with this, I cut the cable cord and went to streaming which saves $170/month. I’m able to restructure my savings models/accounts with the extra income to further my FI!
– Jones
3 years ago, I was paycheck to paycheck until I found ChooseFI. I’ve maxed out my Roth the last 4 years, contribute 23% to my 401k (in addition to the 7% match from my company) and have a healthy emergency fund. After almost a year of telling myself I’ll do it eventually, I have finally moved my non-emergency fund to a HYSA! It was so easy to do. If you’re waiting for a sign to open a HYSA, this is it!
– Michelle
All of those 1% ‘s/small wins have added up to us reaching CoastFI this week and we couldn’t be more excited. We found the FI community back in 2020 and it opened our eyes to all of life’s possibilities when you live intentionally. We were lucky to have been naturally frugal into our early 40’s along with solid incomes in a low cost of living area.
With some help from sources throughout the FI community like ChooseFI, we were able to put it all together. We have won our lives back! The FI community is obviously so much more than finances. It opens a window on how to live a better life.
– Jason and Alexandra
My 1% better this week was receiving my PAID IN FULL letter for my student loan debt after returning from a trip to celebrate paying them off! I finally just paid off my six-figure student loan debt that I’ve had since 2014 after graduating from PA school. My husband joined me for a few days in Nashville to celebrate before my national professional conference. Of course, we used travel rewards for free Southwest flights and a Hyatt hotel stay, and we even hacked enjoying a concert at the Ryman!
You see, instead of spending $120+ per ticket for two seats next to each other, we found tickets for two seats that were located one in front of the other. These had “obstructed views”, so the tickets were only $50 each. On the day of the concert, the usher brought us to our seats, then told us that there were actually two open seats next to each other with better views that we could sit in for the concert. Score!
– Kat
Hi, I’m new to the FI community, though well on my way to potential financial independence if we want it in a few years. We are in the middle of a home remodel (paying in cash!) and an delivered last week just went on sale for 30% off.
My 1% better was calling the store to ask if they could price match, my expectation was that I was out of luck as it was purchased a month before. I was pleasantly surprised that they issued a gift card for the difference, which will be put to good use in the new space! It was only 5 minutes of my time, I just needed to be willing to try.
– Heather
Our 1% better this week was to refocus on our finances. We have been on finance autopilot, still following our savings goals with less focus over the years on expenses. In reevaluating the last year and looking forward we have taken the following steps:
1. Caught an increase in our wifi bill as our first-year discount expired. We called and managed to get this reduced via an auto pay discount allowing us to keep the same rate.
2. Canceled $150 HBO subscription
3. Updated our budget to account for one-off annual expenses like insurance payments and professional license renewals.
4. Reevaluated our spending on Walmart+ and determined we should be more mindful about shopping the pantry first!
5. Confirmed all 2023 retirement accounts met the annual limits
These steps have helped get us in gear for 2024 and focused on keeping our expenses down and our career progression (and hopefully income) moving forward!
– Leia
