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Old 03-22-2009, 06:23 PM   #21
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Self Employed, just ment I could work 12-15 hr days, 7 days wk..and not get paid for OT.. but it got the job done..none the less..and got me out of visiting the Mother-In-Laws alot..LOL

Most of my Buddies? Did the same with Insurance or Self Employed / Franchise type businesses..

oh, 1 was his dad's Business and another married into one..Kudo's for them..!
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Old 03-22-2009, 07:25 PM   #22
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It is IMO "what you spend" that is the most important "part" of the deal. Many earn a very good income but if you "grow into your income" you may "learn" to spend more than is prudent (and LBYM). Live for today but save for tomorrow.
Well said. I think that is the fundamental difference between those friends who are able to FIRE and those who are continually struggling and say they will never be able to retire.
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Old 03-22-2009, 08:22 PM   #23
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My investment road to FI
1. Education. Family close to minimum wage meant fees paid plus hardship scholarships to University meant parents did spend a penny. Graduated in EE and got a good job.

2. Perfect Marriage. Met girl from similar background at college on same course and funding (only girl on course) - married at end of Sophomore year and we both worked for the same company. Now in our 33rd year of marriage.

3. LBYM. Never had any debt other than a mortgage. No car for first 2 years of marriage, then crappy ones for next 2 years until we'd saved enough to buy a decent one.

4. Career Moves. Even with 2 young children prepared to move long distances and switch careers to get high income.

5. Prudent investing, nothing unusual. Pensions should cover 2/3rds of needs

Full disclosure: not there yet, still got 42 weeks before able to RE with pension and health benefits. My company is a 50/50 JV and one of the owners has filed for Chapter 11 this last week so still a chance pension could fall through, be delayed etc. Still plan to RE next year or ESR and cut back expenses if there are pension problems.
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Old 03-22-2009, 08:29 PM   #24
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I got to FI by not investing... I never contributed to 401K's because I wanted to stockpile cash to keep my options open. Then I saw an idea for a business, started it part-time, and after about 7 years it was doing well enough to get my first big contract, which I financed with my cash stockpile. Then I spent all the subsequent income on hiring people and was able to leverage my way up. It was all self-financed and credit-card financed except for a $20K loan from my father. Made several million.
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Old 03-22-2009, 08:31 PM   #25
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Very similar story here. My megacorp run up was about 50x over the last 10 years of working. Once the idea of FIRE occurred to me, I systematically diversified on the way up as options vested. On occasion this looked foolish to colleagues who "let it ride", but I was basically out by the top in 08 to a 60/40 diversified boglehead portfolio. (Now its more like 50/50). No kids, and a frugal wife (with a state job with retiree health insurance ) helped a lot too.

I worked really hard, but it was definitely largely luck, (and enough sense to not get greedy and blow it!)
What I was trying to suggest was that the second set of 'luck' would have made me FI eventually, even if I never had the first. All that having the first bunch of luck means is that I can live better in retirement (and sooner) than either:
  • when I was working
  • that I ever hoped for in retirement
YMMV
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Old 03-22-2009, 11:20 PM   #26
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The road was short for me, starting in 2003, at age 34, and ending in January this year. I had always been able to save, but only to spend all of money on multi year global trotting. I had incredible experiences and little savings. At 34 and newly married, my goals changed or more accurately stated, I finally set goals. Initially the goal was simple save as much cash as possible and retire in the next 15 years.


As the saving increased, more and more investment and professional opportunities presented themselves. Everybody is going to have a different path to FI. Too many variables ( personality, intelligence, LUCK...). My advice is to first build a cash cushion to take advantage of opportunities. Then make the financial choices that “YOU” determine prudent.


What works for someone else, most likely won't be what works for you. If you enjoy holidays with friends and family and only save 10% of your salary a year, you might die a happier than the person that saved 50% and retired 15 years earlier.
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Old 03-23-2009, 10:28 AM   #27
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Another way to FI is to take outsized risk - put most of your eggs in one basket and hope it pays off. If you take these risks young enough, you have time to recover if it all blows up in your face as long as you don't take on debt.

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Old 03-23-2009, 10:39 AM   #28
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Another way to FI is to take outsized risk - put most of your eggs in one basket and hope it pays off. If you take these risks young enough, you have time to recover if it all blows up in your face as long as you don't take on debt.
True, and it's not just with investments. Many people who are wildly successful in business today had several prior failed businesses, but they never gave up. To paraphrase a quote from Mary Pickford, "failure isn't in falling down, but in staying down."
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Old 03-23-2009, 11:15 AM   #29
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True, and it's not just with investments. Many people who are wildly successful in business today had several prior failed businesses, but they never gave up. To paraphrase a quote from Mary Pickford, "failure isn't in falling down, but in staying down."
... and also take some risk with your career. Position yourself in companies and industries that have large upside potential. (like biotech with stock options). You get the relative stability of good salary, but also get some chance at the big payout. Hang in there long enough to learn new stuff, build a reputation as a "doer", network like hell, follow the lead of people you respect to new opportunities. Rinse, lather, repeat. Even if you don't hit the jackpot, you will have a hell of a lot more fun!
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Old 03-24-2009, 06:39 AM   #30
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Don't obsessively monitor your portfolio. Once you arrive at an appropriate investment allocation based on sound investment principles, let it ride. Review performance annually to rebalance if needed.

Jim
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Old 03-24-2009, 06:53 AM   #31
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Just interested in knowing some of the investment roads others took to get to FI. Was it investing in stocks: buy and hold, day trading ; mutual funds, individual stocks. Real Estate. Very good paying jobs with good 401k investments over a long period ? And last but not least: Luck ??
All of above + savings (less spending).
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What would be your advice to others starting in their 30's as a prudent investment roadmap, knowing what you know now.
Pick an asset allocation that you feel comfortable and stay the course. Save! Save! Save!
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Old 03-24-2009, 08:20 AM   #32
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Went to college and got business degree.

Graduated in 1988 and couldn't get a real job. I begged a commercial real estate firm to hire me. They would not pay me a salary-- only a draw against future commissions. Worked for them for a year and only sold a couple of small apartment buildings-- barely enough to break even on the $1000/month draw.

My dad called me and said he was ready to get out of the car business. I got a job selling cars in HoustonTX to get some experience and made $4500 the first month in late 1999 selling Oldsmobiles. I did this for a year.

Worked for my dad and his partner for two years and learned all facets of the business, then bought my dad's 1/2 interest out. Business started really rolling and I made lots of money and bought my dad's partner out two years later. Made even more money and lived cheap and we saved about 75% of what I made. I plowed all this savings into the stock market in individual stocks. Got really lucky and made some money on Microsoft, Cisco and Intel in the tech boom and sold before the bubble exploded. Pure dumb luck. Put the rest into more conservative stocks (that still fell 50%!), but I think they will come back.

Had plenty to retire 2 years ago but procrastinated. Business failed this year and I lost damn near 50% of my portfolio recently but I retired anyway. So far so good.

Obviously I got lucky having a dad in a business that I could buy into. I have always said owning a good business was the best way to get rich, but I think it will be harder for years to come due to over regulation, higher taxes and struggling consumers.
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Old 03-24-2009, 10:10 AM   #33
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CD, did you close the doors yet?
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Old 03-24-2009, 10:16 AM   #34
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CD, did you close the doors yet?
Inquiring minds want to know.......
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Old 03-24-2009, 10:27 AM   #35
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The younger you want to retire, the more risk you need to take. Think: open a business, lots of investment property, join a start-up, or trade penny stocks.

Else, LBYM will do a nice job if you persist for a couple decades (minimal).
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Old 03-24-2009, 10:29 AM   #36
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CD, did you close the doors yet?

Inquiring minds want to know.......
I closed it. March 15th was the last formal day for employees, but I am renting the shop and equipment to my service manager and a couple of really good techs. Hope they make it. It was pretty slow back there last time I looked.

Working on fine tuning slashing the budget as we speak. Wife got a teaching job, got a little rent coming in, got a little money in the bank. It doesn't look too bad, other than trying to sell the house. Four others went up for sale on our street the very day we listed ours. Arrrrrg. Also, I'm not having any luck on the refi now that I have no earned income. That is a sore subject and worth a whole new thread. Wells Fargo put so many demands and conditions on the refi I couldn't do it, and they were going by tax returns from the last two years when I was making money. I think they saw car dealer on the tax return and started making up reasons to not give me the loan. I'm an 802 beacon with enough cash to pay the house off if I want to and have other liquid assets, but they still would't do it. What's up with that. I'm working on some other banks now........

I'm open to ideas on this refi deal. If we sell the house it's not an issue, but if I can't sell it I really need to refi to get the payment lower (longer term and lower rate).
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Old 03-24-2009, 10:33 AM   #37
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CD, sorry you had to close and I wish you good luck.

If you're going to sell the house anyway, why not pay cash and avoid all the expenses of a mortgage. Once you sell the house you'll be whole again and you can save that expense.
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Old 03-24-2009, 10:36 AM   #38
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I closed it. March 15th was the last formal day for employees, but I am renting the shop and equipment to my service manager and a couple of really good techs. Hope they make it. It was pretty slow back there last time I looked.

Working on fine tuning slashing the budget as we speak. Wife got a teaching job, got a little rent coming in, got a little money in the bank. It doesn't look too bad, other than trying to sell the house. Four others went up for sale on our street the very day we listed ours. Arrrrrg. Also, I'm not having any luck on the refi now that I have no earned income. That is a sore subject and worth a whole new thread. Wells Fargo put so many demands and conditions on the refi I couldn't do it, and they were going by tax returns from the last two years when I was making money. I think they saw car dealer on the tax return and started making up reasons to not give me the loan. I'm an 802 beacon with enough cash to pay the house off if I want to and have other liquid assets, but they still would't do it. What's up with that. I'm working on some other banks now........

I'm open to ideas on this refi deal. If we sell the house it's not an issue, but if I can't sell it I really need to refi to get the payment lower (longer term and lower rate).
Screw WFC. Got to a local credit union.......
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Old 03-24-2009, 10:55 AM   #39
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Sucks for cardude, but it looks like fiscal discipline has returned to mortgage underwriting. The pendulum swings the other way...
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Old 03-24-2009, 11:18 AM   #40
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There are many years of wisdom in these responses.

I would add: know yourself. Assess your personality, don't try to change your stripes to meet another person's success formula. Be brutally honest with yourself when assessing investment risk.

Also, read a lot. See the Bogleheads site for recommended reading lists.
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