Most important financial decision in your life

[Animorph]

1. Spouse
2. Joining a start-up company with stock options.

 

[jjquantz]

Apart from the usual like married well, eductation, work hard/smart, etc. etc. two that stick out would be:

-remain in megacorp's DB plan (grandfathered) instead of being bought out for a poultry sum in 2000. Those that took the DC option got slaughtered in 2002 and again in 2008. Performance bonus' during each of the six years prior to retirement increased my entitlement by forty percent. A double dip!

-selling stock options at a good price to secure our retirement and having the good luck to do so prior to the 2008 crash AND holding onto the money as cash because we were not certain what to do with it. It allowed to invest later and realize excellent gains.

But just think what you could have done with all of those chickens!

 

[NW-Bound]

I cannot pinpoint to a single most important financial decision.

Overall, I make more right decisions than wrong ones. And when I was wrong which was quite often, none were serious enough to bankrupt me.

If I could have avoided the bigger wrong ones, like quitting megacorp to get involved in startups that failed, I would have been further ahead financially. But then, I would not have the "exciting" life experience I have had.

Yep, more right than wrong is all one can hope for.

 

[kcowan]

One thing above all:

Making the best strategic use of my time at every life stage.

Everything else seemed to flow from those decisions.

 

[Meadbh]

I can think of several financial decisions that made a big difference to my ability to ER, but they built on each other. I guess the key early decision was made in high school: to get a professional degree while my parents were still supporting me. Even at age 14 I understood the concept of FI and made it a priority to become economically self sufficient on the income side.

 

[CaliforniaMan]

I cannot pinpoint to a single most important financial decision.

Overall, I make more right decisions than wrong ones. And when I was wrong which was quite often, none were serious enough to bankrupt me.

If I could have avoided the bigger wrong ones, like quitting megacorp to get involved in startups that failed, I would have been further ahead financially. But then, I would not have the "exciting" life experience I have had.

Yep, more right than wrong is all one can hope for.

+1

I feel the same. Could have done better, avoided doing much worse, some luck along the way. Like to think I have gained some wisdom on the journey, but maybe it is just blurry vision.

 

[scrabbler1]

-selling stock options at a good price to secure our retirement and having the good luck to do so prior to the 2008 crash AND holding onto the money as cash because we were not certain what to do with it. It allowed to invest later and realize excellent gains.

I would not call it a financial decision as much as it was more good luck for me, too, in 2008. As my ER plan was falling into place that year, I had assumed an approximate selling price for my company stock and a buying price for the bond fund I would be using the proceeds to purchase and receive a nice monthly dividend to cover my expenses. What I did not count on but saw develop through that summer and into the fall was a big drop in the bond fund's price while the company stock price kept rising just not by as much (which was fine). The result was my being able to buy about 25% more shares of the bond fund than originally anticipated, making my ER get a nice boost right from the start. "Buy low, sell high," is great when you can both of them at the same time! With the bond fund not paying as much per share as it did back in 2008, having 25% more shares is nice because it offsets the drop in monthly DPS.

 

[Walt34]

A variety of things.

1. Growing up poor. Not in poverty, we never went hungry or without basic essentials, but living within or below our means was a necessity. That meant that at an early age I knew the difference between "I need" and "I want". Part of that was being raised by parents who came of age during the Great Depression. They weren't scarred by it, but they never forgot it either. Both sets of grandparents were equally conservative.

2. Education. A two-year community college AA degree got me into a reasonable-paying career with a good pension then, by today's standards an excellent one. It also allowed me to bootstrap myself to get the BS degree and that got a bit higher pay and pension.

3. Although it was the 2nd time around, marrying DW. First time was to one who bailed when I flat-out refused to take out a loan to go on a trip, but that happened early enough in life that I had time to recover. If anything DW is more conservative than I am.

 

[rodi]

#1 - I chose the right parents. Not just because I won the lottery of brains and a debt free public college education... but because mom and dad epitomized LBYM values... took me a while to realize they were smart, not just cheap... but I came around fairly quickly.

#2 - I chose the right husband. He had zero debt, owned his own house,car, etc. He also had the right attitude about spending & LBYM vs you have to enjoy life now. Because of this we both took job sabbaticals when we got married (unpaid) and traveled for 12 weeks. Glad we did since kids followed quickly after that, making travel more expensive.

#3 - buying the house I grew up in from my dad. This locked in *his* prop 13 tax rate. A huge factor in reducing our annual expenses going forward.

But the #1 is really the biggest impact - good genes and good values are a very good inheritance.

 

[foxfirev5]

DW - 36 years, 401k - 34 years, slowly plodding along with infrequent major purchases.

 

[Rustic23]

Staying in the Air Force until retirement.

 

[dallas27]

No one likes hearing this, but quitting college was the best decision i ever made. Was after sophomore year 1998, got me into the tech boom before the 2k bust, all my peers begging for jobs in 01 when none were to be found. My trajectory to this day is still taking off because of how i started, and my friends have all languished because they entered a rough market. The opportunities I had with no experience took them years to reach.

The key moment was listening to microecon prof discuss boom and bust cycles. Realizing we were in the biggest boom ever told me something.




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[samclem]

IMHO

1. Who, if anyone, to marry

2. Chosing to LBYM

Amen to both, but the marriage choice was the first one that came to mind.

 

[Lisa99]

Leaving Ameriprise in time to get our money into index funds before the current bull market.

 

[Independent]

At age 28, gave up on my preferred career because the job prospects looked poor. Switched to a higher income track.

Plenty of poor decisions also, but this one made up for them.

 

[Daniel J]

Started my own business.

Joined Bogleheads.

Fired Merrill Lynch advisor.


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[EastWest Gal]

1. Going to med school when and where it was cheap UCLA was$269/quarter when I started. Text books cost way more than tuition.

2. Having only one child. Would not have missed that experience-I learned to ski and enjoy roller coasters because of DS.

3. Moving from Silicon Valley to a low COL area in 1998, sold a condo for $120K more than my house here.

4. Started investing after tax dollars in index funds early on.


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[Elbata]

I'm difinitely a late bloomer.

I got tired of renting and bought a cheap place in a bad part of town (paid cash).
That was my springboard to making almost $1MM (in real estate) quite rapidly.

No doubt, I got lucky. I kept rolling the dice and continued winning.

Now I'm easing into a Boglehead, LBMM, MMM lifestyle.

 

[gerntz]

First job choice after college. Mega had a huge profit-sharing plan that I had no idea would be so beneficial. Net, dumb luck actually though being educated well-enough to get the choice was necessary.

 

[ChiliPepr]

While it was not intended to be a financial decision, it turned out to be the most important financial decision: being childfree

Runner-ups to the top choice: avoiding debt and paying off debt early

And of course, LBYM

Yes, being child free was key
Mostly... Zero debt, except I have and will keep my 30 year, 3.375% mortgage.
Yes, LBYM is key.

I also will add luck. I have a well paying job (technology) and tied that will a well paying industry (finance); being good in both had a bit of a multiplicative effect on my compensation.

Of all of them, I think LBYM is the most important item. doesn't matter if you may $30K or $30 million, if you spend 101% of it you will end up miserable; if you spend 90% and save 10% you will end up happy and will be able to retire early.

 

[REWahoo]

[-]Evading[/-] Avoiding being drafted when I graduated college in 1969, choosing instead to seek a commission in the USAF.

 

[Ozstache]

Choosing to stay with my employer's old lump sum / pension scheme instead of being lured into the fancy new one with a projected higher lump sum payout but delayed pension. Had I chosen the latter, I would be at least 10 years away from enjoying the COLAed pension to which I am now accustomed that more than makes up for the lower lump sum.

 

[RockyMtn]

Deciding to move across country to accept a job promotion at the age of 24. Left the life long comfort of family and friends but it jump started my career that ultimately led to FIRE at 51.

 

[scrabbler1]

Yes, being child free was key
Mostly... Zero debt, except I have and will keep my 30 year, 3.375% mortgage.
Yes, LBYM is key.

I also will add luck. I have a well paying job (technology) and tied that will a well paying industry (finance); being good in both had a bit of a multiplicative effect on my compensation.

Of all of them, I think LBYM is the most important item. doesn't matter if you may $30K or $30 million, if you spend 101% of it you will end up miserable; if you spend 90% and save 10% you will end up happy and will be able to retire early.

I added bold to two of your statements because they surely played a role in my ER. Luck was my former company going for-profit in 1997 and allocating shares of cheap company stock (based on annual compensation) just when I had my peak years of earnings. Those shares of stock exploded in value by 3000% (yes, that is thousand) by the time I cashed them out in 2008 afer ERing.

But nearly all of my coworkers also acquired lots of those cheap shares in the late 1990s and early 2000s but could not or chose not to ER. And I had many childfree friends who, despite low expenses, could not ER because they did not have a huge blob of company stock they could cash out. But someone who was both childfree and had that big blob of company stock to cash out (and who LBYM) could combine these multiplicative effects of good fortune and planning and ER at age 45 as I did in 2008.

 

[Totoro]

Moved to a different country doing the same job. This increased pay with 10%, then another 25% (promotion) within a month, and then halved my tax rate.

Net effect: for doing the same job I roughly doubled my take-home pay in two months.

And I worked 20% less hours (still 80+ though).