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New Year, New Contribution Limits Happy New Year! It’s a new year, so that means there are new contribution limits for retirement and tax advantaged accounts and even if we maxed these accounts out in 2022, we’re back down to $0 contributed in 2023 and are ready to fill the accounts up again. My family can contribute to an HSA since we have a (very) high deductible health insurance plan.  I saw the recurring reminder in my ToDoIst app on January 1st to max out the HSA, then quickly googled what the new contribution limits are for 2023 ($7,750 for a family), and initiated the contribution via Fidelity. This all took about 5 minutes and it’s an example of the continued action we’re taking to optimize and make our financials lives better. What action are you going to take this month to improve your financial life? Net Worth Calculation for 2022 Speaking of taking action, here’s a timely one: I think it’s really important to track your net worth on a yearly basis (I personally do it on a quarterly basis but since the year and quarter just ended, this is a nice easy two-for-one to get started!). Really simple to

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: ChooseFI Community Taking Action This Week ​

But What if Things Go Right? Diania Merriam was on the podcast this week (Episode 416) and it was an extraordinarily powerful episode describing how she quit a toxic work environment on principle and really flexed her FI-muscles. Her email newsletter with 8 Lessons Learned from 1 Year of (F)un-employment is, simply put, a must-read. My favorite was #2 ‘We’re so scared of what could go wrong, but what if things go right?’ EconoMe Conference 2023 I also floated this at the end of the episode with Diania, but wasn’t certain at the time of recording: I can officially confirm that I’ll be attending the EconoMe Conference which is being held March 17-19, 2023 at the University of Cincinnati. This is the first live FI event I’ve attended since 2019 and I could not be more excited!  We’re still figuring out the details, but I’ll definitely be helping to co-host some of the events and workshops. If you’re looking for an in-depth FI event, EconoMe is a great choice in every way.  I’d absolutely love to meet and hang out with as many ChooseFI community members as possible, and this 3-day event is a perfect opportunity. Diania was kind enough to offer our community 10% off

Optimal Order for Investing Your Money Our good friend Tae Kim from the Financial Tortoise (he’s been on the podcast in Episodes 186 and 302) put out a YouTube video last month that went viral with over 200k+ views called, “Optimal Order for Investing Your Money.” I highly recommend watching the 10-minute video and while I could probably quibble around the margins with a few of the picks (maybe not Roth IRA?), I thought this was an excellent primer for how to conceptualize the prioritization of your savings. Here’s Tae’s list: 1) Emergency Fund2) 401(k) match (essentially a 100% instant return)3) Pay high interest (over 5%) debt4) Max Roth IRA (for tax certainty)5) HSA (Health Savings Account)6) 529 plan (if you have kids)7) Max 401(k)8) Taxable account (regular savings)9) Pay low interest debt (under 5%)10) Pay off mortgage (purely optional) End of the Year: Take Action It’s easy to just write off these last few weeks of the year and think that positive changes should wait until the new year or be accompanied by some silly ‘resolution.’ My challenge to you today is simple: Take one action to make your life better between now and the end of theyear. You

Travel Rewards Success! My family has cancelled numerous trips since March 2020 and haven’t really had a travel rewards “success story” in years. That ended this week with a big win. We were able to use points to book The Atlantis resort in the Bahamas for this coming spring break using Marriott points! We were originally contemplating using cash to book the hotel, but it was over $800 a night, which seemed excessive. Then Laura remembered reading something years ago that you could use rewards points, so I looked into it and mocked up a 4-night stay.  It came to 300k points and I had a balance of 305k Marriott points. I nearly forgot something huge, which Marriott was kind enough to remind me of:  You get the 5th night free on an award booking, so we were able to get a 5th night for that 300k points. We’d had these points sitting around for years, so to get $4,000+ of hotel nights felt like a big win for us! This reminds me of an email that Ahmed wrote in: “One my latest wins was using points to book a hotel for my trip to the Boston Marathon in April! Hotels are

Simple Path, Index Funds & Long-Term Thinking We have a big week on the podcast this week starting with the episode that dropped yesterday (411) with JL Collins on The Simple Path to Wealth.  This is a great refresher on long-term thinking, investing in low-cost index funds and the simplicity in matching the market over many decades and, in the process, outperforming nearly all active investors. Stay tuned for Friday’s episode (412) with Alan and Katie Donegan that we’re calling “What’s in Your Index Fund?”  Katie dove deep on the fundamentals of some of the biggest index funds and the three of us had a great time discussing the ins and outs of this essential investing strategy. These were on my mind when I saw Brian Feroldi, great friend of the show and author of the fantastic book “Why Does the Stock Market Go Up?,” tweeted something we all need to remember, especially in times of turbulence in the markets: “I don’t know how the market will perform in December. I don’t know how the market will perform next year. I don’t know how the market will perform over the next 3, 5, or 10 years. I do know the odds tilt ever more

Giving Thanks With this week of Thanksgiving upon us in America, I wanted to take this opportunity to thank all our public servants and men and women in uniform. That generally sounds trite, but I was reminded of their essential nature just last night when we had a carbon monoxide alarm go off in our home and our local fire department showed up within 5 minutes of our call. Three firefighters and an engine came out and professionally tested and swept through our home in minutes and, after diagnosing the faulty sensor, gave us the all clear. That is why we pay taxes and why we have a society that functions. I’m reminded of this every time I go to the library or a state or national park; or when the school bus comes to pick my girls up to take them to public school. Tens of millions of public servants working to make this a happier, healthier, functioning society. Thank you. Munger’s Best Quotes on Investing Charlie Munger, the vice chairman of Berkshire Hathaway, is, in my opinon, one of the clearest thinkers on Earth. I find such wisdom in his statements that I’m constantly searching for more gems

Year-End Tax Planning I’m publishing a podcast episode this Friday with Sean Mullaney, the FI Tax Guy, about 401(k)s, the Mega Backdoor Roth and Premium Tax Credits for the ACA and in a case of great timing, Sean just released his “2022 Year-End Tax Planning” article. The article lists out numerous essential tax deadlines and considerations you should be familiar with before the end of 2022, which is rapidly approaching! If you’re looking for more in-depth general strategy on year-end tax planning from Sean, we’ve had him on the podcast the past 3 years to discuss this very topic, so check out Episodes 155R, 274 and 351. Calling for 2022 FI Wins! My favorite ChooseFI podcast episode each year is our “Year End Wins” episode where we play voicemails and read emails from the community celebrating your biggest wins of the past 12 months. If you want to share your wins with the community, hit reply to this email or send in a voicemail and detail out your FI year in review! I’d love to highlight as many of these as possible on the episode airing at the end of December. Updates and Corrections I love the ChooseFI community for so many reasons,

Tax Gain Harvesting Ava wrote in: “I feel like a lot of your guests talk about tax gain harvesting as something to do only when they quit their jobs and have no income, but I took advantage of it while I was still working. When I was making about $50,000 in 2020, the taxable income limit for getting the 0% long term capital gains rate was $40,400 for single filers. The key word here is taxable income. I took $50k of gross wages and subtracted the $12,400 standard deduction for a single person and my taxable income went down to $37,600. I also realized I could reduce my taxable income even further by maxing out my 401k which reduced my taxable income by another $19,500. My taxable income was now only about $18,100 – meaning that I could sell and rebuy appreciated stocks and mutual funds in my brokerage account and not pay any federal taxes on about $22,300 of long-term capital gains in 2020. I did this for a few years while I was making a sufficiently low income to get under the threshold. Given the 401k max and the standard deduction I would encourage any single person making

Check Engine Light DIY Fix The FI Designer from DesigningFI.com wrote in with some important info: “In Episode 402, Vivian said that her car had an engine replacement and an ongoing engine warning light was adding stress to her life. I wanted to share some advice that may help Vivian and the greater FI community. You may feel powerless when your vehicle’s engine warning light comes on, but there are steps you can take to lessen the dread by purchasing/borrowing an On-Board Diagnostic (OBD) reader. An OBD reader will tell you what the error code is and how severe it is. Some readers even give you links for purchasing the replacement part on Amazon which is valuable in estimating the repair cost. The OBD reader will also give you the ability to reset the error code to turn off the warning light, but the light will come on again if the issue persists. This is a case where knowledge is power. My post, the ‘Financial Benefits Of Being Handy’ discusses the OBD reader in greater detail. They are remarkably inexpensive, starting at around $30 on Amazon. I chose the BlueDriver Scan Tool at around $120 because it had slightly more advanced functions,

2023 IRS Updated Limits and Deductions The IRS just came out with the tax year 2023 update for a few essential items, which were all favorably adjusted: Free Course on Creating an Extraordinary Life I recently had the pleasure of recording an episode with Alan and Katie Donegan on the topic of index funds, which will go live in about a month (that will be a great week of podcasts starting with a JL Collins episode releasing on Monday and the Donegan episode on Friday!). They told me that to celebrate the 10th anniversary of Rebel Business School they are launching a 100% free course on creating and designing an extraordinary life for 2023 and beyond and wanted to make sure the ChooseFI community knew about it as early as possible. It is called the Extraordinary Life Course and it starts November 21st so sign up today to get registered. Per Alan it is “One session a week for 5 weeks, 90 minutes each session, with a new topic each week.” They premiered this course at the Mr. Money Mustache HQ and in Colombia at Chautauqua, and this is the first time it’s going online, so this is a very cool opportunity

ChooseFI Book Club Ginger wrote in with a great idea of doing a ChooseFI Book Club and I jumped on it. The first installment is tentatively going to air on Friday December 16th. The book we picked is ‘Four Thousand Weeks: Time Management for Mortals’ by Oliver Burkeman, which was recommended by numerous members of our community and seemed like the perfect place to start. The plan is for me, Ginger and Josue (another community member whose story you’ll hear on the podcast in a few weeks) to talk through the book, our big takeaways, and actionable items. But it wouldn’t be a book “club” with only 3 of us, so I’d like to get you involved as well.  Grab the book from the library and join us! Send me an email response or send in a Voicemail with your big takeaways on the questions we’re pondering: We’re recording in early December, so you have some time to read the book and pass along your comments and feedback. This is an experiment, but if we like this format, I could see us doing a handful of these Book Club episodes each year! Library Hacks With the book club upcoming, this is a great time to remind