Being born into a rich western country.
Yeah, me too. I pat myself on the back for this one nearly every day. Probably the best financial decision I ever made.
There’s still many nuances people get wrong all the time. Did you pick financially independent parents?
Fuck! No, I fucked that one up too and accidentally picked a crazy Haight-Ashbury 1967 hippie together with a seriously damaged Vietnam vet, the two of them getting involved in weird cultish shit long before I was born.
It was a poor decision on my part. No one to blame but myself.
No one to blame but myself.
Eh, live and learn. Next time!
You need to pull yourself up by your birthstraps.
Underrated answer. Meritocracy is a lie, folks, even within the West. If you do everything perfectly you will climb a little bit, and only on average. All the counterexamples you’re thinking of are people who won a lottery of some kind. And of course, birth is also a lottery.
A literal move actually. 20 years ago I moved from America to a country with universal health care. That has saved my family probably close to a quarter million bucks in health care fees alone.
Not to mention the headache. It feels like every time I get treatment I have to argue with my insurance until they eventually cave (assuming it’s something they actually cover). I asked my mom if this is how healthcare is really like and she said “yeah it’s just the culture, it’s normal” acting as it having to beat the fuck out of a metaphorical piñata to pay for life saving treatment is ok or acceptable. Like why the fuck can’t you just pay for the treatment that I fucking pay you to cover?
Oh god, I hear ya. A long while back I needed some serious treatment and ended up in a hospital for two weeks. It was the first time I had ever gotten truly sick, so I was dreading the final bill. But when the docs said nah you’re good, it’s covered, just take your meds and come back in a week for your follow-up, I damn near died a second time :P
Did you move to Vietnam?
Close, it was Japan
I’ve heard the Japanese have extreme xenophobia these days. How do you survive? Is it hard to make local friends?
Most of the things mentioned in this thread are mostly dumb luck and not necessarily active financial decisions.
Kind of the point. A lot of financial “success” is nothing but dumb luck.
Yeah, half of these comments are just: I bought a house.
If there was an active financial decision you could make and reliably get rich, everyone would do it.
Not necessarily rich, but there are active financial decisions you can make that will set you on the path to longterm prosperity. Buying a house at what happened to be exactly the right time and making a $100,000 in 3 years in the process is not one of them. That’s just dumb luck.
I mean, “consistently save in a diversified portfolio” would be a pretty boring answer, but it would be an answer I guess. I’m not sure what the equivalent for the poor would be; stay away from substances, maybe?
I even specifically said as much in my comment.
damned Reddit immigrants
In 2017 my landlord raised my rent from $1k to $1100 a month for the place I rented with my daughter because I finally broke down and got her a dog. I was annoyed because this wasn’t in the lease but I was month to month by this time and figured I could probably get a house around me for the same cost and at least I’d be building equity. I closed in 2018 on a $120k fixer upper on 12 acres. I got a $30k rehab loan and my mortgage/insurance/property tax payment ended up being just over $1100. I spent 7 months in major renovations.
Fast forward to today, I have a 2.875% mortgage rate with just over $1000 a month all in payment (early COVID refi saved me about $100/month), my house was just appraised for $415k, and I was able to sell 5 acres of the land for a total of about $160k.
A free shelter dog ended up turning $150k into $575k. 10/10 would recommend.
I was gonna say buying a house too. Mortgage payments are 1/3 what my rent was, and rents have doubled since then.
Life changing circumstances, but big props on you for having the confidence to go through with it! Life presented you with the opportunity and you seized it!
This is wholesome sorry. I am happy for you both anons and that you have doggo a great loving home <3
Mined a Bitcoin in college.
Pretty much the same. Bought some Bitcoin in high school in the early 10’s. It was just a novelty and I was a kid, so I didn’t buy much, but if someone was kidnapped or something it would be worth it to go through my old drives.
BTC recently got approved to be traded as an ETF by the SEC, so now’s a good time to find that drive cause the price is only going to go up over the next 5+ years.
Yeah, I’m not going to get rid of any. I was doing everything on thumb drives at the time, though, so it would be a bitch to actually try and find the exact one I used.
Of course, the value of the things will go to 0 whenever Q-day happens, and hopefully sooner when people realise it’s a badly designed cryptocurrency. Maybe I should dig the old wallet up just to move things to an alt coin.
My buddy traded his for rent
- Not having a car (always living/renting in walking or biking distance of my work)
- Moving in with my partner straight out of college so we could split expenses
- Moving (with partner) to a low-cost-of-living city for the first 5 years after college
- Putting most of my medium-term and long-term savings into low-expense-ratio, passively managed index funds starting in my early 20s
- Buying almost exclusively second-hand clothes, furniture, and cookery
- Borrowing all desired books (and many desired movies and TV shows) from the library
- Only buying games when they are bundled or otherwise on steep discount years after release
- Pirating any other media in which I’m interested if its distributors make it even remotely difficult for me to buy it at a reasonable price
- Planning all dinners in advance every week before grocery shopping (leads to almost never eating at restaurants or ordering takeout, and almost no food waste because grocery list is based on actual meals)
Now, if I had to choose the best financial move out of that list? Probably the index funds. Though not having to pay for a car (or car insurance, or car registration, or car repair and maintenance, or parking, or fuel) is a close second.
I’m contemplating moving even further towards the lifestyle you have but I struggle with balancing “live for today” vs “live for tomorrow”. In some ways I think we live too much for today, we rarely wait more than a month or two with buying whatever we feel we “need”. We go on vacation abroad every other year at least and do activities monthly that most other families in our neighborhood do maybe yearly or quarterly. Partly because we have much higher income than our neighbors but we could of course save more and if we really buckled down we could likely by financially independent in less than 20 years.
How do you balance and how do you think regarding these matters, what’s your philosophy?
I’ve never felt I’m not living for today. Admittedly, most of what I want to do is consume a variety of media within the comfort of my home. But we also travel abroad every other year or so, and that’s probably the biggest ‘entertainment’ expense in our lives. If we need a car to visit someone or somewhere outside the range of public transit or biking, we just rent one for the weekend (probably happens about once a year). We don’t have to hesitate before choosing to do that because we know we’re living well within our means the rest of the time.
The thing is, once you’re in the habit of doing this stuff, it doesn’t feel like an imposition. It’s just the way your life works. It was actually a bit of a struggle to remember all of those points when I was writing up that list yesterday, because it’s all just natural to me now. There are probably a few more things we do along these lines that haven’t occurred to me.
And at that point, the savings are just a natural choice for what to do with all the surplus money. It’s not even ‘living for tomorrow.’ It ceases to be an either/or situation. It’s living for today in such a way that you can continue to live for today throughout your entire life.
Also, there are a huge number of non-financial benefits on offer here, too: walking and biking at times you’d otherwise be driving is excellent for your health; planning meals allows you to choose healthier options, cut down on red meat consumption, etc; meal planning, buying second-hand goods, and not driving reduces dependency on online mega-retailers, international sweatshop labor, and environmentally harmful practices; making use of the library system indirectly supports its continued existence for folks who have no other options; and on and on.
Anyway, I wouldn’t recommend trying to do all of this at once if it’s all a change for you. I’d recommend slowly introducing each of these practices over time so you have time to get used to each in isolation.
Not buying a boat
Choosing to be child-free.
Same here! Spent about $100 for my vasectomy after insurance. Best $100 I ever spent really, saved me hundreds of thousands.
As 2023 was beginning I set a goal that I would have $5k in the bank no matter what.
Up to this year I’ve been living paycheck to paycheck. But resolving to save up $5k pushed me out of that for the first time ever.
I never did hit $5k. But I stopped living paycheck to paycheck. I haven’t checked my balance before paying rent since february of last year. I always have enough, and I just pay the bill.
The amount of stress that immediately goes away when you are able to stop the paycheck to paycheck cycle is priceless. Nice work!
It also helps that I’ve got a little financial system going.
I get paid every two weeks. My rent is about 1200. Each paycheck is about 1200 - 1400. Paid every two weeks. Each paycheck, 1000 goes into my “bills” account, and the remainder into my “spending” account. So each paycheck I get about $300 for groceries, coffee, entertainment, whatever.
All the bills are on auto-pay to draw from that bills account, and the 1000 per paycheck is enough to cover all my bills plus save some. So my savings is accumulating in the bills account.
I also got myself a credit card for the first time in twenty years, and now my phone bill’s being auto-paid from that, with the CC being auto-paid from the bills account.
That structure helps too. But I wouldn’t have been able to start it without a lump of cash on hand
Paying off my fucking car. New cars are a scam guys, don’t be stupid like me 6 years ago.
Doesn’t have to be if u keep it long enough. The problem is folks usually get upselled long before it sarts being a good deal.
Accidentally buying a modest house in what at the time was a “distressed” neighborhood because it was all we could afford. 15 years later the neighborhood has been gentrified and is highly desirable. The property has tripled in value and the land is now worth more than the house itself.
Anyhow, it was dumb luck on my part and again, mostly had to do with the place being affordable and relatively close to my wife’s parents.
the land is now worth more than the house itself.
This is usually the case. When the value goes up, pretty much all of the increase is due to the land value increasing. Land is a limited resource that’s always in demand, especially in desirable areas. The house itself is actually going down in value over time due to depreciation.
In my area it’s not uncommon for at least 70% of the value of a property to be in the land, and the house itself accounts for less than 30% of the value. There’s a lot of houses built in the 1940s to 70s in highly desirable areas.
I’ve never thought about it like that, but it makes good sense.
Deciding not to get a car; it saves ~400.000 euros in my lifetime which at 40k net a year income means 8-10 year earlier pension
Ahh, European public transportation. Not an option in the US unless you live in NYC and rarely leave the city.
I just got a new job near DC that I can actually take the train to from MD. It’s like 2 hours each way but I don’t have to fuckin drive (except to the station) so 100% worth
I legit can’t tell if you’re being sarcastic. lol
I can’t imagine being ok with a 4-hr daily commute in a private car with all the amenities, much less one on a public train.
You’re way tougher than I am, if you’re serious, I’ll say that!
A public train or bus is a way nicer commute than in a car. In a car you can’t really do anything but drive. On a train you can do just about any seated task. I wfh now but when I didn’t I would login and start work during my commute.
Fair enough. I’ve only had to use a train in one city when I would go to the airport and that shit was terrifying sometimes. Also, I can just listen to an audiobook if I’m trying to be productive in the car
Right, i forgot to mention that my current commute is about 3 hours of driving. I am also super suceptible to road rage, so without fail I end up spiking my cortisol begore even getting to work.
I am gladly swapping it out for an extra hour of being able to do shit like watch youtube and doodle (plus it pays a hell of a lot more than my current job)
I’m so jealous. My work is only a mile away, which in a perfect world I could walk in 10 mins, but because of many slow crosswalks and busy intersections it’s like 30 mins freezing my balls off. Plus there’s a section of road that’s 40mph (64kmh) with no sidewalk, and a bridge that forces pedestrians onto the high speed road. It’s both slow and basically suicide if I tried to make a habit of walking.
There’s another route but the intersection I would need to cross is excruciatingly slow. I had to sit for 15 minutes before I could cross. Plus it’s another 40mph road and if someone runs a red I basically die.
Damn if I hear this I am so glad to live in the Netherlands. Infrastructure here is designed such that everybody takes a bike or walk if within a few miles, on safe roads
It’s unfortunate that much of the US is stuck in a feedback loop of people saying “walking sucks, I’ll drive”, roads and driving infrastructure are improved at the cost of pedestrian infrastructure, more people say “walking sucks”, and repeat. Eventually you get like 12 lane highways at the cost of many sidewalks, bike lanes and tram/train lines being bulldozed.
Eventually everybody has to drive because pedestrians have been squeezed out of the equation. It saddens me that people don’t realize how nice walking could be, because they have only experienced poor pedestrian infrastructure. Even people like me who would love to walk have to choose driving or a death wish.
That being said it is slowly improving, many towns near me are implementing bike lanes, and more side walks. Unfortunately the bike lanes are the “safety paint” variety but it’s at least something. As mentioned before my little town is renovating town square and it’s a lot more walkable. Unfortunately not that helpful for me because the town square is only like 600 feet in size (200 metres) in size, but again, it’s something.
I would love to visit Amsterdam just to walk my little butt off haha
40mph is 64kmph not 93kmph but yeah that’s still uncomfortable to bike besides if it’s busy. I’d say instead of posting it here, send a letter to your local government.
My bad, I have changed it now. Thankfully my town is already working on it, I’m just waiting for the pedestrian infrastructure to spread beyond the town square.
I keep meaning to look at exactly what my small car costs per year.
Last estimate was £1000 a year on fuel, parts, and maintenance.Which is equivalent to 50+ hours of car club use.
For now, I have too many “shit, I need to get this large/heavy object 5 miles away” moments to make it worth it.
But long term, I kinda like the idea of not having to worry about the car.Insurance and depreciation are the bigger costs I think, but even ignoring those; if you have “heavy objects” less than once a week it would probably still be cheaper to just rent a van when you need it. Convenience might be an argument but yeah that’s what you pay the big bucks for.
That figure actually includes depreciation and insurance! In fact, almost half of it is just the bloody insurance… Though I should possibly make an allowance in the figure for future repair work, as it’s an older car.
I think once my big project (and associated last second trips to the builder’s merchant) is finished, I’ll have a go at living without the car.
My housemates may not be too happy about the private taxi service shutting down though!Average car insurance cost in London is 1200-1600, surely yours isn’t less than half that?
That’s the benefit of not-london and a small car: It’s under £500!
I decided to basically stop buying anything unless I absolutely needed it for about two years. I put everything I had towards paying off my car and student loans. I had holey socks and shirts, torn up shoes, etc. Refused to spend money.
As a result, I was able to invest the money I was paying on my car and loans and eventually worked enough for a down payment on my current house.
God bless those clothes.
Haha, thanks for catching that.
It was accidental.
So I started working at a startup right after I graduated college. They couldn’t pay a competitive wage, so they gave me a ton of stock. A year into working there, about half the company was laid off. I survived. They begged us not to leave the company by giving us more stock. I started interviewing elsewhere, because I have bills to pay, but I never got any other jobs. Then one day they handed me an envelope. It contained paperwork for even more stock. I thought it wasn’t going to be worth the paper it was printed on, so I kept looking for other jobs. Never found one.
Well, a few years go by and the company starts doing very well. Then we got bought out. Suddenly all the worthless stock they gave me was worth a fuck ton of money. The buying company bought ALL of it. Even unvested shares. One day they wrote me a really, really big check, then I went and bought a house.
It was absolutely life changing, and I tried to throw it away at every chance I got. I got so lucky.
Buying a house during covid when I saw rent was increasing drastically for no apparent reason. I could barely afford it at the time but thanks to inflation and a couple raises, I’m comfortably sitting on a house that’s now worth 50% more than I bought it for, and paying way less than current rental prices. Rent is insane right now.
