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FI Weekly – December 27, 2022: Year End Wins Episode, Two Items of Note

Year End Wins Episode is Live

I’m going to keep the newsletter short and sweet this holiday week.  I hope you are enjoying some rest and relaxation and time with loved ones!

The 6th annual Year End Wins podcast episode came out yesterday, so if you haven’t had a chance to listen yet, download ChooseFI Episode 417 and enjoy the community’s favorite episode of the year.

Two Items of Note

I promised to keep this email short, but wanted to pass along two things I’m keeping my eye on:

  • The Secure 2.0 Act passed through Congress and could become law quite soon.  As a rule I don’t like talking about future legislation that isn’t set in stone, but since this will impact retirement accounts significantly, I wanted to give you a heads up.  Here’s an article from CNBC with some bullet-point highlights that are worth scanning.
  • The password manager LastPass experienced a worrying “security incident” recently and even though their detailed blog article about the incident makes it seem like there’s a slim likelihood your data was compromised, many security experts online are suggesting it may be worse than it seems and you should consider first moving to a new password manager and then changing every single one of your passwords (and more broadly, if you haven’t setup two-factor authentication everywhere possible, please do this ASAP!!).

ChooseFI Community Taking Action This Week

  • Kisha said, “I am excited to share my 1% better. Over the course of the last 18 months I have started a business and a partnership between the 2 income streams I am now preparing to leave my W2 employment! I have used Rebel Entrepreneur principles and only spent $500 to start these business. The time freedoms and exponential earnings is truly amazing!”
  • Christi said, “I have two 1% this week! The first one is financial. My company doesn’t have a 401k. Earlier this year I set up an IRA with Vanguard on my own and contributed $3k of the $6k max for the year. This week, I contributed the other $3k making out my IRA contribution for 2022. I’m a good saver, but a horrible investor, so clicking that button is big for us! Our second 1% is we finally booked our appointment for our passports so we can go see our friend in Japan in 2023, hopefully using points from my credit card!”
  • Shawn said, “My 1% better is taking the time to allocate my new jobs retirement 401k from a managed fund with .08% fees to an index fund with .02% fees. I don’t have a lot in retirement and I know those aren’t drastic numbers, but this one move and a “set it and forget it” should pay off well over the next few decades of work and investing.”
  • Traci said, “I purchased my first rental property, a triplex, for $367k. My calculations were that I would need to put in 40k in renovations and updates, and I estimated that I should be able to bring in at least $4600/month. I have been learning a lot about insulation, caulking, toilets, paint, trim, and working with contractors. I’m happy to say even though I was $5k over my renovation budget, I have been able to rent out the units for $5700/month, and I’m actively looking for the next one.”
  • Joe said, “My 1% better feels like so much more this week! We moved several months ago and finally sold our old home. We used approximately $90k from the sale and paid down our new mortgage. This got rid of $230 a month of PMI (we had to put less than 20% down to move before selling our home). That alone is awesome, but also saved us 112 payments, which is over 9 years of payments! This equates into paying a quarter million less in pure interest throughout our mortgage! Talk about a win!”
  • Mandy said, “My 1% better this week was finally transferring my IRA out of a high fee firm and into a new Vanguard account. There were some hoops to jump through with trying to get a Medallion Signature Guarantee, which is why I delayed doing this for almost 2 years but it ultimately only took a couple hours. I also opened a Vanguard brokerage account and set up a bi-weekly transfer to automate my savings. FI, here I come!”
  • Ben said, “My 1% better this week is to donate $$$ to my favorite local charities. I’ve already maxed out 401k, HSA, put $6,000 into my IRA account, put more money into taxable brokerage account and met my other financial goals for 2022. Feels good to be able to support things like my local zoo, adoption services, and abuse prevention places. Plus, as a side benefit we get an awesome behind the scenes tour of the zoo which includes seeing the tigers being fed. My 2 year old loves it!”

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