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FI Weekly – November 16, 2021

2022 Limitations for 401k, IRA & HSA

This week I came across an article from CNBC describing how the IRS increased the 401k contribution limits for 2022 plus one from Kiplinger’s on the 2022 HSA limits.

While I suggest looking at both of them in more depth (especially if you’re 50 and older as you have the opportunity for additional contributions to some accounts), the highlights are:

401k contributions: Employee contributions increased to $20,500 for 2022.  Per the article, “The new amounts also apply to 403(b), most 457 and Thrift Savings Plans.”

IRA contributions remain the same at $6,000

HSA contribution limits for 2022: self-coverage = $3,650. Family coverage = $7,300

Mad Fientist Quote on FI

It’s a rare treat when Brandon, the Mad Fientist, posts a new podcast episode and his release this week didn’t disappoint.  This quote jumped out to me immediately:

“For me, back then, it (FI) was a finish line.  Everything was going to be great after that finish line and everything wasn’t working prior to that finish line.  And I think that was definitely the wrong way to do it.

I think the more you can view it as just a spectrum where every dollar you’re saving is adding to that power that you have to take more time off, or follow that passion project to another level, I think the better off you’ll be and then the less crazy FI or post-FI life would be after, because it’s not going to be just like flipping a switch. It’s just going to be this gradual progression into ‘oh, actually now I have the power to have unlimited free time and now I know how to deal with that and use it properly because I’ve practiced along the way as I’ve incrementally gotten more free time.

So that’s how I would view it, just as a spectrum and not as a goal line.”

Buying the Constitution?

Alex Lieberman, co-founder of Morning Brew (my favorite newsletter), posted the below Tweet which piqued my interest and helps highlight the incredible ways communities can come together around a shared goal in the new world of Web3 (the decentralized internet of the future, built around blockchains):

“Web3 is daunting as [email protected]

If you want an on-ramp, here it is.

There are 11 remaining originals of the Constitution.

Only 1 is privately owned.

It is being auctioned by @Sothebys on Thurs.

@ConstitutionDAO is using community/tokens to buy it.

We’re buying…the Constitution.”

— Alex Lieberman

If you want to learn more, here’s a longer Twitter thread posted by Alex, but simply put, a random group of strangers is able to come together for a common purpose — in this case buying a copy of the US Constitution — without ever having met in person or having known each other beforehand through a “DAO” (decentralized autonomous organization).

This is a fun example of the game-changing nature of this technology.

ChooseFI Community Taking Action This Week

  • Lance said, “The one thing I did this week was hit $401k in my 401k.”
  • Lexie said, “I’d like to share my 1% better this week: I added value to my Amex credit card by asking about retention offers. I have an Amex Platinum card. As the annual fee will go up for this card, I was debating what I should do with the membership. To help myself decide, I chatted up the Membership Consultant Team on Amex website. Through conversation with them I was able to get a retention offer of 55,000 reward points with a reasonable amount of spending on the card within the next couple of months. As Amex points can be pretty valuable when used for travels etc., I consider it a good value-adding action I took this week :)”
  • Brittany said, “My 1% better this past week was having the ability to drive a good distance to see my grandparents and purchase them $200 worth of groceries on a “whim” when I found out they weren’t eating because they couldn’t afford groceries. The ability to know that I had money to do that without worrying about overdrawing accounts or not being able to pay bills, was an amazing breath of fresh air. That level of freedom is irreplaceable.”
  • Aaron said, “My 1% better this week: I finished maxing out my 401k for the year, hit 75% of my lean FI number for the first time, and had my best friend visit (first time I’ve seen him in over two years thanks to COVID) and was able to treat him all weekend because I’m in such a strong financial position now.”
  • Stewart said, “My 1%- I’ve started a new hobby/side job of officiating youth and high school sports. The schedule is very flexible and fits in great with a 9-5 job. I can stay active and be a part of the sports that I love. On top of that the pay is not bad!”
  • Christine said, “Guess what I did for my 1% this week???? I completed my 2021 Roth Max contribution (which includes my catch up) Now I’m putting what I can into the Roth 401K my employer offers. Wooo hooo!!! Thank you so much for all you guys do.”

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